India will examine proposal to impose price cap on Russian oil purchases, says Union minister

India on Wednesday said that it will examine Western countries’ proposal to impose a price cap on oil purchases from Russia, Reuters reported.

The Group of Seven, or G-7, countries has been seeking to enforce a price-capping mechanism on oil exports from Russia since December 5. On that day, the European Union’s ban on imports of Russian crude oil by sea will also take effect.

The price cap is aimed at reducing Russia’s ability to fund its invasion of Ukraine, and reduce the impact of global energy prices for low and middle-income countries, according to Mint.

“I think there is an exemption for Japan for Sakhalin, then there is crude which comes through the pipeline, so they have exemptions...we will have to look at it,” Union Minister for Petroleum and Natural Gas Hardeep Singh Puri said on Wednesday.

The minister was referring to the Sakhalin-2 project, which involves the development of the Piltun-Astokhskoye and Lunskoye oil and gas fields off the Sakhalin coast in Russia. Oil supplied from the project will not be subject to the G-7 countries’ proposed price cap, according to Russia’s state-owned TASS news agency.

New Delhi has increased its oil imports from Moscow significantly since the Russia-Ukraine conflict started in February. Earlier this month, Finance Minister Nirmala Sitharaman had said that India’s crude oil shipments from Russia have risen to 12% from about 2% in February.

On multiple occasions since the Russia-Ukraine conflict started, the United States has said that it was not in India’s interest to increase energy imports from Russia.

However, on October 7, Puri said that no country had told India to stop buying oil from Moscow. He added that the government has a moral duty to provide energy to its citizens.

“India will buy oil from wherever it has to for the simple reason that this kind of a discussion cannot be taken to the consuming population of India,” he said.