India’s recent massive import of Russian crude oil has received much ink and alarm. This arrives amidst the backdrop of the new tariffs enacted by former President Donald Trump. India is now the second largest buyer of Russian oil, importing nearly 1.7 million barrels per day. This is a non-trivial amount considering that Russia’s total crude exports are now 3.35 million bpd. This deeply entangled energy trade relationship has prompted concern for our national energy security, geopolitics, and U.S. economic stability.
India’s steady increase in imports of Russian crude oil over the last few years has been notable. This share is projected to drop to 36% in 2025, as it accounted for 38% of India’s total crude imports in both 2023 and 2024. As a result of growing domestic demand for crude oil in India, total crude imports have increased each year. As of 2021, Russia is the world’s third-largest producer of crude oil. It leads the United States and Saudi Arabia, consistently pumping out close to 11 million barrels of oil per day.
This EU ban on seaborne imports of Russian crude has produced a pronounced shock to the market. Thanks to this change, the share of Russian imports has dropped like a stone from 29% to only 2% by 2025. And even with these restrictions, the EU continues to import 19% of its LNG from Russia. This number is calculated using Eurostat data of Q1 2025.
Until then, the United States had been tacitly encouraging India’s Russian crude purchases by imposing no sanctions. The sale would have taken place above a price ceiling meant to restrict Moscow’s revenue from oil exports. As of today, this price cap is $60 per barrel. Industry sources in the Indian petroleum industry claim that the price difference is negligible, only $1-2. This means that India is not purchasing Russian crude at a large discount.
The consequences of India’s blithe purchases are deep. Analysts speculate that if India were to abruptly cease its crude oil imports from Russia, global crude prices would spike exponentially. For all importers, prices could exceed $200 per barrel. India has announced that it won’t stop purchasing Russian oil unless a credible plan is developed to do so. This plan needs to both stabilize energy markets and offer a credible alternative supply to make up for any shortfalls.
India maintains that it has abided by all international sanctions. It asserts that purchasing Russian oil is, contrary to expectations, actually helping protect the global economy by stabilizing prices in a time of crisis. The price cap is meant to reduce Russia’s revenue from oil exports. Together with ongoing financial sanctions, this action will further squander Russia’s capacity to bankroll its military efforts in Ukraine.
In light of these dynamics, Trump’s recent imposition of an additional 25% tariff on India has raised concerns about the impact on India’s Russian oil imports. At the present time, the total levies imposed by India equal 50%. Notably, analysts are eagerly watching to see how these tariffs will impact India’s calculus and ultimately what it decides to do on the largest energy procurement strategy.
“India has always coordinated closely on US oil policy, including sanctions on Iranian oil. At the same time, for the Trump administration, energy security, affordability, and reliability are priorities.” – Sara Vakhshouri
At the heart of this debate, the nuances and realities of the matter are emphasized by diverging accounts from opponents and proponents alike. Some U.S. observers contend that the U.S. has already pressured India to purchase Russian crude oil in order to lower prices and stabilize markets. According to Hardeep Singh Puri, India’s Minister of Petroleum and Natural Gas, “The price of oil would have gone up to 130 dollars a barrel. That was a situation in which we were advised, including by our friends in the United States, to please buy Russian oil, but within the price cap.”
Bob McNally, an energy expert, pointed out the precarious nature of global oil prices in this context: “Very near term, there is a risk of a pop in brent prices to $80 or above.” He further noted the inconsistency in U.S. messaging regarding India’s oil purchases: “Joe Biden went to India after the invasion of Ukraine and begged them to take Russian oil… Now we’re flipping around and saying, ‘why are you taking all this oil.’”
Experts warn that there could be serious repercussions if Russian crude production is cut in half. Giovanni Staunovo commented on OPEC+ countries’ capacity to address supply disruptions: “While OPEC+ countries hold spare capacity to tackle supply disruptions, a full drop in Russian crude production/exports would see that spare capacity completely dwindling. The Biden administration was aware of this.”