Image Source: Times of India
India is gearing up to increase its imports of Russian crude oil in September 2025, disregarding the 50% tariffs imposed by the United States aimed at penalizing this trade. Despite pressure from Washington to curtail these purchases, Indian refiners and policymakers remain focused on securing energy at competitive prices to meet the demands of its growing economy. This development highlights India’s balancing act between geopolitical pressures and its economic imperatives, as well as the evolving landscape of global energy markets.
India's Rising Russian Oil Imports
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India is expected to ramp up its Russian crude oil imports in September 2025 after a short pause in July.
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Imports currently constitute nearly 40% of India’s total crude oil supply, a sharp increase since 2022.
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Discounted Russian oil remains attractive to Indian refiners despite narrowing price gaps compared to other crude sources.
U.S. Tariffs and Pressure
The U.S. administration under Donald Trump imposed up to 50% tariffs on Indian goods in response to India’s purchase of Russian oil, including a direct 25% secondary tariff on this trade.
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The tariffs are intended to penalize India for financially supporting Russia amid its conflict with Ukraine.
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U.S. officials have threatened even harsher penalties if India continues its imports.
India’s Response and Strategic Calculus
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Indian government and refiners prioritize energy security and affordability over U.S. pressure, emphasizing business pragmatism.
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Ambassador Vinay Kumar stated India will buy oil "where the best deal is," underscoring the decision’s commercial nature.
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Indian refiners resumed purchases with contracts arranged for September and October deliveries, signaling steadfastness.
Economic and Market Dynamics
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Discounts on Russian crude have decreased recently, from about $3 per barrel to closer to $1.5, influencing short-term buying volumes.
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Despite this, renewed discounting is expected to revive imports in coming months.
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India’s refiners balance economic gains with geopolitical risks by maintaining diversified crude sources.
Broader Geopolitical and Trade Implications
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India’s continued Russian oil imports have strained India-U.S. relations but strengthened India-Russia economic ties.
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India benefits not only from oil imports but is also exploring expanded trade in sectors like technology, textiles, and automobiles with Russia.
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The U.S. faces criticism for selective tariffs, as China, another major Russian oil buyer, has not faced comparable penalties.
Impact on Domestic Energy Security
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India’s refusal to cut Russian oil imports reflects its focus on stable domestic fuel supplies and affordable energy prices for its vast population.
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Abruptly stopping Russian oil purchases could disrupt supply chains and increase fuel costs, impacting the broader economy.
Sources: Times of India, Economic Times, Indian Express, Kyiv Independent, Al Jazeera, BBC News, Analysis of U.S. selective tariff application and India-China contrast
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