India’s Ongoing Purchase of Russian Oil Amid Iran War and Uncertainty Over Trump Sanctions Waiver
In March 2026, India faced a potential crisis in crude oil supply due to the closure of the Strait of Hormuz amid escalating tensions from the US-Iran conflict. In this challenging scenario, Russian crude oil emerged as a vital lifeline for India, with import volumes reaching historical highs. Despite US sanctions impacting Russian oil majors, India has aggressively increased its procurement of Russian crude, capitalizing on a temporary waiver that has allowed for significant imports. Experts suggest that while Russian oil has become a dominant supplier, this trend may shift once stability returns to the Middle East.
US Sanctions Waiver and India’s Aggressive Buying
India has not officially committed to halting its purchases of Russian crude oil, even as sanctions have affected import levels. The recent waiver of US sanctions has enabled Indian refiners to ramp up their purchases significantly. According to the Centre for Research on Energy and Clean Air (CREA), while overall crude imports into India fell by 4% in March, imports from Russia surged, doubling compared to previous months. State-owned refineries reported a staggering 148% month-on-month increase in Russian crude imports, driven by greater availability in the spot market.
In March 2026, Russia accounted for a significant portion of India’s crude oil imports, mirroring the peak levels seen in 2023 when Western sanctions redirected Russian oil flows to Asia. This shift has positioned Russia as India’s largest crude supplier, displacing traditional sources like Iraq and Saudi Arabia. Experts note that while the current dependence on Russian crude is high, it is likely to decrease as Middle Eastern supply chains stabilize and Indian refiners return to sourcing from Gulf countries.
No More Discounts: India Paying a Premium for Russian Crude
Initially, when India increased its imports of Russian crude following the onset of the Ukraine war, the oil was available at steep discounts due to European sanctions. However, by 2026, the situation has changed dramatically. With disruptions in the Strait of Hormuz and rising global crude prices, Russian crude is now being sold at a premium. Indian refiners are currently paying about $4-6 per barrel over the Brent benchmark for Russian oil, marking some of the highest premiums since the conflict began.
This shift in pricing is attributed to heightened competition for Russian cargoes, as refiners prioritize assured deliveries amid ongoing supply disruptions. The premium contrasts sharply with earlier months when Indian buyers secured Russian crude at discounts of $12-$15 per barrel. The price dynamics have shifted significantly since 2022-23, when Russian crude often traded $20-$30 below Brent prices. As a result, India has transitioned from discount-driven purchasing to a focus on securing reliable supplies, even at higher costs.
Why India Continues to Buy Russian Crude
Experts believe that Russian crude will remain a staple in India’s oil imports for the foreseeable future. However, some analysts, like Ivan Mathews from Vortexa, anticipate a decline in Russian crude imports in April due to reduced discounts and increased demand during the sanctions waiver period. This may lead to lower imports for economically driven refineries in India.
Despite potential fluctuations, Russian crude is now well-integrated into India’s refining system, serving as a reliable alternative when other supplies are constrained. Current imports are tracking around 1.6 million barrels per day, slightly lower than March levels, but this decrease is contextualized by maintenance activities at key refineries. Experts assert that even with the expiration of the sanctions waiver, Russian oil will continue to be imported, albeit in potentially reduced quantities.
India’s Diversified Crude Supplies
While Russian crude remains a crucial component of India’s oil imports, the country has diversified its sources to include over 40 nations. This diversification strategy has been essential in navigating the complexities of global oil markets and geopolitical tensions. Improved refinery capabilities allow Indian refiners to process a broader range of crude grades, enhancing energy security.
India’s approach to sourcing crude is driven by price, availability, and the need for energy resilience. This flexibility enables Indian refiners to adjust their sourcing patterns in response to changing market conditions and geopolitical developments. As the global energy landscape evolves, India’s diversified sourcing strategy will continue to play a vital role in ensuring a stable and secure energy supply.
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