India’s thirst for Russian crude barely eased in September and is almost certain to rise again in October even as US President Donald Trump ratchets up pressure on New Delhi to shift toward American oil.
Trump insisted Wednesday that Prime Minister Narendra Modi had assured him that India would stop buying Russian crude oil. But it wasn’t immediately clear if this was a Trump pressure tactic.
Also Indian moves to slow purchases aren’t likely to happen till a trade deal is actually struck.
The Union External Affairs Ministry spokesman said Thursday that India’s consistent priority has been “to safeguard the interests of the Indian consumer in a volatile energy scenario. Our import policies are guided entirely by this objective.”
Analysts draw a comparison with the Gaza agreement and point out that the release of Palestinian prisoners and Israeli hostages only began after the deal had been struck.
India imported about 1.6-million barrels a day (bpd) of Russian crude last month and looks set to take slightly more through the yearend.
“India-bound Russian spot loadings are expected to remain slightly higher into Q4 versus Q3,” says Sumit Ritolia, lead research analyst at global data and analytics firm Kpler. This month purchases are likely to be around 1.8 million bpd.
War damage to Russian refineries may add more barrels to global supply, but India’s orders hinge on price. The once hefty $10-$20 per barrel discounts have shrunk to $2-$3, but are still enough to make economic sense for bulk buyers.
Indian refiners are hedging their bets, expanding purchases from Iraq, Saudi Arabia, the UAE, and Kuwait, as well as Nigeria, Angola, Venezuela, and the US.
“Russian barrels are likely to remain the core of the import mix,” Kpler’s Ritolia says, “though refiners are clearly placing more emphasis on diversification across the Middle East, Americas, and Africa.”
Between June and September state-owned refiners cut back on Russian crude purchases but this was a temporary slowdown because of maintenance at four refineries.
The US is pushing India to step up American crude imports as part of wider trade talks. India has the capacity to purchase an additional $15 billion of oil from the US, a senior commerce ministry official said Wednesday, a move that would be aimed at easing tensions and advancing negotiations.
“Right now we are at an average of $12-$13 billion as per financial year 2025 figures, and there is headroom for $14-$15 billion more with the current refinery configuration,” says trade secretary Rajesh Agrawal. Energy imports from the US, he notes, have been steadily rising.
A larger energy tab could help narrow India’s $42.7-billion trade surplus with the US and calm Trump, who has slapped a 50 per cent tariff on Indian goods.
The US upped its tariff on Indian goods in August, citing Delhi’s Russian oil purchases that, it said, were helping fund Moscow’s war on Ukraine. But now analysts speculate the real motive behind the punishing US tariffs may be to get to India to purchase more US oil and ensure that global prices don’t fall too far.
Indian officials in Washington are hoping to finalise a trade deal as early as next month, according to Bloomberg.
New Delhi’s larger strategy in attempting to forge a trade agreement is to buy more US goods, widen access to Indian markets and cut red tape to smooth relations. It’s reportedly considering roughly $40 billion in major purchases, including defence and oil, to ease India’s trade deficit with the US.
Still, logistical realities limit how much US oil India can take.
“India has limited upside in taking significantly higher US volumes,” Kpler notes. “US grades face both logistical disadvantages and compatibility challenges with Indian refining systems, which makes a material swing toward American crude unlikely.”
India’s imports of US crude have averaged 280,000 barrels a day in 2025, up from 199,000 bpd in 2024, peaking at 364,000 bpd in July.
Before the Ukraine war, Russia barely figured in India’s energy matrix. Moscow supplied just under 1 per cent of imports. After Western buyers boycotted Russian oil over the Ukraine war, India swooped in, and Russian oil now makes up 35-40 per cent of its crude basket. The higher shipping costs were easily offset by deep discounts.
At first, Washington quietly approved of India’s Russian oil purchases, relieved that they were helping avert a global supply crunch. But as prices fell, supply grew and US trade tensions flared, the mood soured.
Brent crude has tumbled from $75-$80 a barrel a year ago to about $62.39 on Tuesday, its lowest in five months. US West Texas Intermediate (WTI) dropped 1.3 per cent to $58.70, after the International Energy Agency (IEA) warned of a looming global glut.
The IEA projects supply could outstrip demand by up to 4 million barrels a day in 2026, with producers pumping more even as consumption plateaus. Supply is now expected to grow by 3 million barrels daily this year and 2.4 million next, while demand rises just 700,000 barrels a day.
“The latest tensions between the US and China will also be a pressure point on crude as China’s economy could be in question if tensions stay elevated,” says Dennis Kissler, senior vice president of trading at BOK Financial.
UBS analyst Giovanni Staunovo adds that investor sentiment has turned risk-averse amid trade frictions and the IEA’s bearish outlook.
Despite the gloomy oil outlook, Washington and Beijing are trying to defuse wider trade tensions. US treasury secretary Scott Bessent said Monday that Trump remains committed to meeting Chinese President Xi Jinping this month in South Korea to ease tariff threats and export restrictions.
But frictions are rising. China expanded controls on rare earth exports and hit five US-linked units of South Korean shipbuilder Hanwha Ocean with sanctions. Washington, meanwhile, is threatening 100 per cent tariffs and software export curbs from November 1.
Such volatility has rippled through oil markets. The Brent six-month futures are at their weakest since May, signalling lower demand and an oversupplied market.
For now, India’s refiners are unlikely to turn away from Russia. “If Washington intensifies pressure, Indian refiners could make a token reduction… to demonstrate diversification and appease Western partners,” says Kpler. “However, these cuts would likely be symbolic rather than transformative.”
Refinery operations are expected to stay strong. “Refinery operations are expected to stay robust, with fewer maintenance turnarounds than last year,” Kpler says.
And any significant overhaul of supply routes won’t happen overnight. “Supply chains are embedded, term deals are locked, and contracts are typically signed six to ten weeks before arrival,” Kpler notes. “Rewiring all that doesn’t happen overnight.”