Over the past few weeks, New Delhi has been reeling from a record-breaking heatwave with temperatures exceeding 42C in numerous cities across the subcontinent. This comes just weeks after India recorded its hottest March since the country’s meteorological department began its records over 120 years ago. This intense heat has led to a major energy crisis, as a surge in air conditioning use in households in the country has resulted in low supplies of fuel to generate electricity.
This has forced India to roll back its policy of coal imports after it committed to “phasing down” the usage of the dirtiest fossil fuel at the COP26 summit in Glasgow.
Prime Minister Narendra Modi’s Government has ordered state and private sector utilities to ensure the delivery of 19 million tonnes of coal from overseas by end of June.
As demand for energy runs high, India is poised to turn to Russia for cheap energy imports, particularly as the EU gradually phases out its imports of Russian coal and oil.
According to Quartz India, Russia is offering New Delhi supplies of coal at a discount of around $10 per metric tonne over Australia’s Newcastle thermal coal.
India, which is the world’s second-largest consumer of coal, and uses the fossil fuel for 70 percent of its electricity generation, could turn to Russia, which is the third-largest exporter of coal.
Vivek Dhar, director of mining and energy commodities research at the Commonwealth Bank of Australia, said: “Markets suspect that India and China may boost coal imports from Russia, offsetting some impact of a formalised EU ban.”
Aside from coal, India has also been stepping up its imports of crude oil from Russia at discounted prices since the start of Vladimir Putin’s invasion of Ukraine.
Imports of oil from Moscow rose from 1 percent in December and January to about 300,000 barrels a day in March and 700,000 a day in April, which accounts for about 17 percent of imports.
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