Russia is offering liquefied natural gas (LNG) to South Asian nations, including BRICS members, at a significant discount. According to a report, shipments are priced near $60 per barrel, a roughly 40% reduction from the near-$100 market rate. This move capitalizes on a global supply crunch stemming from Middle East tensions, with intermediary firms in China and Russia facilitating the deals.
Russia is leveraging a global oil supply disruption caused by the closure of the Strait of Hormuz. The administration led by Vladimir Putin is offering LNG at a steep discount to energy-starved countries in South Asia and BRICS members.
Bloomberg reported Russia is offering sanctioned LNG to energy-hungry Asia at a discount. The price is reportedly close to $60 per barrel, significantly below the market rate of approximately $100.
Purchasing this sanctioned oil helps Russia uplift its economy, as businesses have stalled due to the Middle East conflict. Following a two-week ceasefire involving the US, Israel, and Iran, the Strait of Hormuz has reopened but operates under restricted Iranian control.
BRICS members and other South Asian nations were offered the 40% discount last week. Intermediary companies based in China and Russia brokered the deals and helped load shipments to their destinations.
India had saved nearly $7 billion in foreign exchange reserves by buying Russian oil since 2022. Even Saudi Arabia previously procured Russian oil and resold it in Europe at higher prices.
While BRICS nations benefit, others remain wary of procurement due to fears of retaliation from US President Donald Trump over tariffs. China is the only country that has persistently bought Russian LNG since sanctions were imposed in February 2022.
