India Reduces Russian Oil Imports Amid U.S. Sanctions

Indian oil imports from Russia fell by nearly one-third following the November 21 implementation of stringent U.S. sanctions against major exporters including Rosneft and Lukoil. While some state-run refiners, such as Indian Oil Corporation and Bharat Petroleum, continue to source from non-sanctioned sellers at discounts of approximately $5 per barrel, several major players have halted imports. Reliance Industries stopped processing Russian oil at its Jamnagar refinery, and other firms including Hindustan Petroleum and Mangalore Refinery and Petrochemicals have ceased imports to avoid secondary sanctions.

Vladimir Putin is scheduled to visit New Delhi from December 4-5 for the 23rd India-Russia Annual Summit at the invitation of Prime Minister Narendra Modi. The leaders intend to discuss payment methods and trade security to mitigate pressure from third countries. This visit follows a period of significant economic growth, with Russian equity inflows into India tripling in FY25 to $18.45 million and bilateral trade growing at a 70% CAGR from FY2021.

Kremlin spokesperson Dmitry Peskov characterized the dip in oil trade as a temporary and insignificant decrease, asserting that Russia is using opaque trading channels to evade sanctions. Conversely, former foreign minister Kanwal Sibal predicted a potential 50% reduction in Russian oil purchases as Indian banks and companies seek to avoid U.S. penalties.