Stories
Indian Refiners Eye Russian Oil Cuts Amid US Tariff Threats, Prioritizing Energy Security
- •Indian refiners may reduce Russian oil imports due to potential steep US tariffs under the Lindsey O Graham Sanctioning Russia and Iran Act of 2026, which grants Washington authority to impose up to 100 percent tariffs on countries buying Russian oil.
- •Despite the risk, a complete halt to Russian oil purchases is unlikely, as refiners assess global oil prices, the availability of alternative suppliers, and the viability of crude sources.
- •India reiterates that energy security for its 1.4 billion people remains a priority, with procurement decisions guided by market dynamics and diversified sourcing, as stated by Petroleum and Natural Gas Minister Hardeep Singh Puri.
- •Analysts expect India to tread cautiously, assessing how aggressively the US enforces the new law, with some suggesting Washington might use the threat as leverage in trade negotiations rather than immediately implementing sweeping restrictions.
- •India, which imports 88 percent of its oil requirements, is expected to diversify its crude mix further towards West Asia, and potentially increase purchases from Iraq, Saudi Arabia, UAE, Venezuela, Brazil, West Africa, and the United States, if Russian crude becomes less attractive.
Key Questions Answered
US President Donald Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, giving Washington the authority to impose up to 100 percent tariffs on countries buying Russian oil. While Indian refiners are unlikely to completely stop buying Russian oil, they may trim imports and adopt a wait-and-watch approach as they assess global market conditions and potential tariff risks.
Petroleum and natural gas minister Hardeep Singh Puri stated that energy security remains a top priority, noting that India has successfully shielded domestic consumers from supply shortages through diversified energy supplies. The external affairs ministry reaffirmed that India is fully committed to ensuring a steady energy supply for its 1.4 billion people.
To maintain flexibility and reduce potential reliance on a single source, Indian refiners are adopting a portfolio approach to increase purchases from Iraq, Saudi Arabia, and the United Arab Emirates. They also plan to supplement these imports with selective sourcing from Venezuela, Brazil, West Africa, and the United States.
