Pushing back against Trump pressure: India’s state-owned refiners look to fully revive Russia crude oil buys; lack of cargoes an issue

Even as the Donald Trump administration wants India to stop purchasing Russian crude, Indian state-owned refiners are looking to fully revive their purchases of Russia oil.

During the four weeks to August 31, India's seaborne crude imports from Russia decreased to 1.3 million barrels daily from 1.97 million in March, whilst China increased its purchases, according to ship-tracking data compiled by Bloomberg.

The US tariffs on India aim to increase pressure on Moscow regarding the Ukraine conflict. Treasury Secretary Scott Bessent has said that Washington and Europe were considering additional sanctions and secondary tariffs on Russia, anticipating that economic difficulties would bring Vladimir Putin to peace negotiations.

India defiant on Russia crude oil purchases

According to a Bloomberg report, Indian state-owned oil refiners aim to resume full-scale purchases of Russian crude at discounted rates, despite US opposition. However, their plans face delays due to limited cargo availability, sources were quoted as saying.

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These South Asian refiners are receiving reduced offers for Russian oil shipments scheduled for October loading, as Moscow has shifted its focus to Chinese markets, the sources indicated. Additionally, Russian oil faces increased competition from other suppliers.

The international oil market is monitoring Indian refiners’ purchasing decisions following the Trump administration’s attempt to restrict Russian shipments by imposing punitive tariffs on most imports from India. While New Delhi strongly opposed this measure, and the tariffs remain active, the Trump administration has recently adopted a more moderate stance.

Oil traders are also evaluating the impact of OPEC+'s recent decision to further relax supply restrictions. This development allows several group members, including major Middle Eastern exporters and Russia, greater flexibility in offering exports.

"We have never stopped procurement of Russian crude," Indian Oil Corp. Director of Finance Anuj Jain said on the sidelines of APPEC by S&P Global Commodity Insights in Singapore on Monday.

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"Depending upon the economics, we continue to buy," Jain said, adding that presently, the effective discount on Moscow's oil stood at $2 to $3 a barrel compared to the Dubai benchmark.

On Friday, Finance Minister Nirmala Sitharaman affirmed the country's commitment to continue purchasing oil from Russia, reinforcing the government's position against US pressure. Previously, Oil Minister Hardeep Puri had responded firmly to the US position on Russian crude imports through a strongly worded newspaper article.

FGE NexantECA Chairman Emeritus Fereidun Fesharaki informed Bloomberg Television on Monday that New Delhi's imports from Moscow could reduce by 250,000 barrels daily next month, indicating that India's maximum purchasing period had concluded.