What will be the impact on the world if India stops buying Russian oil?
Moody’s warns halting India’s Russian oil imports could tighten global supply, raise crude prices, fuel inflation, and impact India’s economic growth.
Russian oil exit by India may fuel global inflation
The discussion about India stopping the purchase of Russian crude oil started with Donald Trump's tweet announcing the India-US trade deal, in which he claimed that India had made such a promise. Rating agency Moody's says that if India stops buying Russian oil, it will have negative consequences not only for India but also for the world.
The trade deal between America and India is being discussed worldwide. The stance of trade organizations and think tanks on this agreement is generally positive. However, global rating agency Moody's has also issued an important warning. According to Moody's, if India stops buying Russian crude oil after the trade deal with the US, it will harm not only India but also the world. However, Moody's also assesses that it is not practical for India to immediately and completely stop buying crude oil from Russia. Other experts also believe that India will not completely stop buying oil from Russia.
What will be the impact on the world if India stops buying Russian oil?
The discussion about India stopping the purchase of Russian crude oil started with Donald Trump's tweet announcing the India-US trade deal, in which he claimed that India had made such a promise. Moody's says that if India significantly reduces its purchase of Russian crude oil, it could further tighten supply in the global oil market. This directly means that the amount of oil available to other countries will decrease, and there will be pressure on prices at the international level.
Oil prices will increase
Moody's says that a large consumer like India suddenly changing its supplier will not only affect India, but will also impact the entire global energy supply chain. Moody's has clearly stated that such a shift could lead to a sharp rise in global oil prices. This will ultimately manifest as inflation. According to the agency, such a move could also prove to be a setback for India's economic growth.
India and America have reached a trade deal
US President Donald Trump has claimed that under this agreement, tariffs on Indian goods will be reduced from 25% to 18%. Currently, negotiators from both countries are working on preparing the official documents of this agreement on a 'war footing'. However, it remains to be seen whether this agreement is a full bilateral trade agreement (BTA) or merely the first phase of a comprehensive agreement.
