Indian officials recently announced their decision to reject a request to pay for Russian crude oil imports in yuan, according to Bloomberg.
Russia and its companies need Chinese money because Russia’s trade has become more dependent on China following the conflict in Ukraine and sanctions against Russia. In fact, Moscow has plenty of Indian rupees and needs Chinese yuan. Russian companies have largely abandoned paying in dollars and euros due to Western sanctions.
According to Bloomberg, Russian oil companies have recently asked to be paid in yuan, but the Indian government is reportedly not going to agree to these requests. Several crude oil shipments from Russia to India have recently been delayed due to disagreements over the currency of payment.
Last week, unnamed sources in India's finance ministry told Reuters that payments in Chinese currency for seven cargoes of Russian crude imported by Indian state-owned refiners were being delayed due to the Indian government's reluctance to accept this form of payment.
State-run Indian Oil Corporation has previously paid in yuan, while Bharat Petroleum Corporation and Hindustan Petroleum have yet to use the Chinese currency, despite requests from suppliers.
India has increased its imports of Russian crude over the past year as Russian supplies are cheaper than crude from the Middle East. Between April and September this year, India’s imports of Russian crude more than doubled to 1.76 million barrels per day (bpd) from 780,000 bpd in the same period last year, according to ship tracking data from Reuters.
IEEJ: $7 trillion needed for global natural gas supply
The Institute of Energy Economics of Japan (IEEJ) believes that about $7 trillion of global investment in natural gas supplies is needed to ensure sufficient demand and avoid a supply crisis until 2050.
As countries look to cut emissions and shift to gas from coal, these investments will have to go toward developing new gas fields, building new LNG export facilities and expanding existing plants, the IEEJ report said.
However, under a scenario where emissions remain at current levels by 2050, the world would need nearly $10 trillion to avoid gas shortages, the Japanese agency said.
The International Energy Agency (IEA) said earlier this month that the pace of growth in natural gas demand in the coming years is expected to slow.
“After the heyday from 2011 to 2021, the global gas market has entered a new and more uncertain period, marked by lower growth and higher volatility and likely to lead to peak global demand by the end of this decade,” said Keisuke Sadamori, IEA Director of Energy Markets and Security.
For its part, the International Gas Union (IGU), which comprises 901 TP3T of the global gas market, recently said that conflicting views on natural gas demand in the coming years have made operators hesitant to invest in new supplies.
“Unprecedented demand uncertainty and insufficient investment in natural gas, low-carbon and renewable gas are putting the energy transition at risk, undermining energy affordability, security and sustainability,” the IGU said.
