India Deepens US Oil Ties But Stresses Russian Crude Will Keep Flowing, Says Report

The strategy of snapping up cheap Russian oil, refining it, and exporting petroleum products — even to nations sanctioning Russian crude — has delivered record profits for Indian refiners.

Despite the rising US share in India’s oil basket, authorities have stressed that purchases from Russia will continue.

Source : Freepik

India has sharply raised its crude oil imports from the United States since President Donald Trump began his second term, marking a notable shift in the country’s sourcing strategy, trade data cited by ANI revealed.

Imports have jumped by over 50 per cent year-on-year, underscoring a deepening energy link between New Delhi and Washington.

Citing government officials, Moneycontrol confirmed the trend and noted, “From January to June 25, India increased its imports of US average crude supplies by 51 per cent compared to the same period last year. (From .271 mb/d in January to June 2025 as compared to 0.18 mb/d in the same period last year).”

Balancing US imports with Russian supplies

Despite the rising US share in India’s oil basket, authorities have stressed that purchases from Russia will continue. This comes as President Trump asserted that New Delhi had halted Russian crude imports — a claim Indian officials have firmly denied.

The clarification is significant, given Washington’s plan to roll out new sanctions next week on countries maintaining energy links with Moscow as the Ukraine conflict grinds on.

Notably, analysts warned India’s annual oil import bill could swell by $9–11 billion if it is forced to cut back on discounted Russian barrels under threat of US tariffs or penalties on Indian exports. Currently, Russian oil — which made up less than 0.2 per cent of India’s crude intake pre-war — now constitutes 35–40 per cent, saving billions in energy costs, stabilising fuel prices, and keeping inflation in check.

New risks loom for Indian refiners

The strategy of snapping up cheap Russian oil, refining it, and exporting petroleum products — even to nations sanctioning Russian crude — has delivered record profits for Indian refiners. But this model is now at risk. Trump has announced a 25 per cent tariff on Indian goods and hinted at an unspecified penalty for Russian oil and arms purchases.

Coming alongside the European Union’s January 2026 ban on refined products derived from Russian crude, the twin pressures could squeeze India’s oil trade. Kpler analyst Sumit Ritolia described it as “a squeeze from both ends”, warning these moves will constrain crude sourcing flexibility, increase compliance risks, and add significant cost uncertainties.

India, the world’s third-largest oil importer, spent over $137 billion on crude in the last fiscal year alone — a figure now under threat of climbing further.