Has India Stopped Buying Oil From Russia? A Strategic Pause Under U.S. Pressure

In the heat of global geopolitics and energy realignments, a simple question has sparked intense debate:

Has India stopped buying Russian oil?

The short answer: not entirely.

The long answer? It’s complicated—and fascinating.

Recent reports from late July to early August 2025 suggest that Indian state owned refiners which process the majority of the country’s oil, have temporarily paused their spot purchases of Russian crude.

But this isn’t an official halt, nor is it a wholesale exit from Russian energy. It’s something more subtle, more calculated: a nuanced recalibration of India’s oil procurement strategy amid shrinking discounts and increasing geopolitical pressure, especially from the United States.

While there’s no official confirmation of a full halt, and private refiners continue importing under long-term contracts, the move signals a nuanced recalibration of India’s energy strategy. The reasons are twofold: shrinking price discounts on Russian crude and mounting geopolitical risks, including Trump’s warnings of 100% tariffs on nations buying Russian oil unless Moscow strikes a peace deal with Ukraine.

A Calculated Pause, Not a Full Retreat

Since the Ukraine war began, India’s oil imports from Russia surged from near zero to nearly 40% of its total crude purchases, turning Moscow into its top supplier. But in late July 2025, state-run giants like Indian Oil Corp, Bharat Petroleum, and Hindustan Petroleum reportedly stopped new spot purchases, opting instead for Middle Eastern and West African crude.

The immediate trigger? Russian oil is no longer the bargain it once was. Discounts on Urals crude have narrowed to just $3–$6 per barrel, down from $30–$40 at the peak of Western sanctions. With alternative suppliers like Abu Dhabi’s Murban and U.S. shale oil now competitive, India’s state refiners are reassessing.

But economics alone doesn’t explain the timing. Trump’s escalating tariff threats loom large. In July, he warned of 100% tariffs on countries buying Russian oil unless Moscow agrees to a Ukraine peace deal—a deadline later moved to August 8, 2025. Days later, he imposed a 25% tariff on all Indian goods, with additional penalties hinted at for India’s continued energy and arms trade with Russia.

India’s Tightrope Walk: Energy Security vs. U.S. Demands

New Delhi has carefully avoided framing this as a political concession. The Ministry of External Affairs insists India’s energy purchases are “based on national interest and market dynamics.” There’s no formal ban on Russian oil, and private refiners like Reliance and Nayara Energy continue imports under term deals.

Yet the geopolitical subtext is clear. India, while asserting its strategic autonomy, cannot ignore the risk of U.S. secondary sanctions or trade penalties.

The pause by state refiners—who handle 60% of India’s refining capacity—suggests a hedging strategy: reduce exposure to Russian crude just enough to avoid Trump’s wrath, while keeping the door open for future deals.

In the diplomatic whirlwind surrounding India’s apparent halt in Russian oil imports, former U.S. President Donald Trump weighed in from Washington, remarking:

I understand that India is no longer going to be buying oil from Russia. That’s what I heard, I don’t know if that’s right or not… That is a good step. We will see what happens.

Trump’s comment came shortly after he announced a 25% tariff on Indian imports, effective in early August, as part of broader punitive measures tied to India’s ongoing purchases of Russian energy and military equipment. His rhetoric served as both a warning and a signal,implicitly applauding a move that aligned with U.S. objectives, even amid uncertainty over its veracity.

To replace Russian volumes, Indian refiners turned to U.S., UAE, West African, and Middle Eastern crude, often signing expedited spot contracts. Reports suggest IOC purchased over 5 million barrels of U.S. crude and 2 million barrels from the UAE, plus 4 million barrels from West Africa.

Russia could lose a critical buyer if the pause continues, while alternative exporters gain ground. Analysts also warn that if Russian supply routes tighten, such as Russia shutting the CPC pipeline, global prices could spike above $80/barrel.

The tariffs are raising alarms in export-driven sectors like pharmaceuticals, textiles, chemicals, and solar modules. India’s wider economic ties are under strain, raising questions about a strategic partnership under threat.

Politics Meets Economics: Did India Fold or Flex?

Yes, India has scaled back its purchases of Russian oil—but only partially, and with strategic intent. The recent pause in Russian crude imports by India’s state-owned refiners signals a recalibration rather than a retreat.

It reflects a convergence of shrinking price incentives and intensifying geopolitical headwinds. As the discounts on Russian oil narrowed and logistical bottlenecks mounted, the calculus for public-sector refiners shifted. This shift was not solely a response to U.S. pressure, but rather an alignment of commercial pragmatism and diplomatic caution.

Yet, to say India has capitulated would be an overstatement. There has been no formal ban, no sweeping embargo. Private refiners, unconstrained by the same geopolitical optics, continue to import Russian crude under existing long-term contracts. Moreover, if discounts on Russian barrels improve again, or if alternative payment mechanisms become more stable, India’s public-sector players can easily resume purchases. At every turn, New Delhi has been emphatic: its energy policy is not driven by ideology or Western expectations, but by national interest and market conditions.

In fact, former U.S. President Donald Trump recently weighed in, suggesting that India’s decision to pause state-backed Russian oil purchases was “long overdue” and “a sign of strength” under pressure from Washington. His remarks, though characteristically brash, underscore the growing perception in Washington that U.S. influence in global energy alignments is reasserting itself. Still, India’s leadership has been careful to frame its choices as sovereign, strategic, and grounded in economic rationale—not reactive to external dictates.

India’s Long-term Energy Diplomacy

India’s energy policy has long pursued strategic autonomy, balancing ties with both the West and Russia. Despite Western sanctions, India doubled its oil trade with Russia from $13 billion in 2021 to $27 billion in 2022.

New Delhi has avoided endorsing unilateral sanctions on Russia and insists on bilateral, market-based approaches to sourcing energy.

What Comes Next?

The road ahead for India’s energy strategy remains complex and fluid. If Washington doubles down on tariffs or tightens financial scrutiny, New Delhi may accelerate its pivot—especially when it comes to state-owned refiners, who are more sensitive to diplomatic signals.

Meanwhile, private refiners are likely to continue honoring existing Russian oil contracts, quietly threading the needle between profit and politics. But this delicate balance could shift swiftly. Should Russian discounts become steep enough once again, India could reenter the market—this time on its own terms, not under pressure.

Conversely, if sanctions on Russia deepen and supply chains fracture further, the ripple effects could jolt global oil prices, straining India’s energy security and inflation management. Amid all this, U.S.–India relations find themselves at a delicate inflection point. Energy policy is fast becoming the newest arena of strategic tug-of-war, and India’s tightrope walk between pragmatism and sovereignty will face more tests in the months to come.

This isn’t necessarily the end of India-Russia energy ties. If discounts widen or payment workarounds (like yuan or dirham settlements) stabilize, imports could rebound. But the broader trend points toward diversification. India is already eyeing more U.S., Brazilian, and African oil, reducing reliance on any single supplier.

For Washington, India’s pause may be a short-term win, proving that economic pressure can alter buyer behavior. But New Delhi’s ultimate loyalty lies with its own energy security, not U.S. geopolitical demands. As one government official noted, “When the discount makes sense, we’ll buy. When it doesn’t, we’ll look elsewhere.”

In the high-stakes game of global oil politics, India is playing the long game—balancing cheap fuel against costly diplomatic friction. For now, it’s opting for caution. But if Russia sweetens the deal again, the pumps may well reopen.