In a major break that may affect one of Russia's strongest energy alliances since the outbreak of the Ukraine war, Indian state-owned refiners have suspended Russian crude purchases over the last week, as per a Reuters report quoting informed sources.
Large government-held refiners - Indian Oil Corporation (IOC), Hindustan Petroleum Corporation Limited (HPCL), Bharat Petroleum Corporation Limited (BPCL), and Mangalore Refinery and Petrochemicals Limited (MRPL) - have not ordered any new Russian oil in recent days, four sources well-versed with their procurement plans informed Reuters.
Neither the firms concerned nor the Indian government has made any formal announcements confirming or ruling out this hiatus in Russian crude imports.
India, the world's third-largest importer of oil, has become the top destination for Russian seaborne oil — a vital revenue source for Moscow as it extends its war in Ukraine, entering its fourth year.
Russia now provides about 35% of India's crude oil requirements, positioning it as India's leading oil provider. This seeming change in supply, however, overlaps with the narrowing price margins for Russian oil and increased geopolitical pressure, especially from the US.
The report also said that the relative price advantage which made Russian crude formerly a preferable choice for India has weakened to its lowest point since 2022. Consequently, the economic incentive to persist with Moscow imports has fallen significantly.
To offset the drop in Russian supply, India is now turning to alternative suppliers in regions such as the Middle East and West Africa. Sources mentioned that Indian refiners have begun sourcing barrels of Abu Dhabi’s Murban crude and various West African grades to meet demand.
But the move seems driven by more than purely market forces. On July 14, a warning was issued by former U.S. President Donald Trump to nations that continue to purchase Russian oil: they may be hit with 100% tariffs, unless Russia and Ukraine sign a broad peace accord.
Adding to the pressure, Trump issued a new 25% tariff on Indian imports beginning August 1. Although insisting that trade negotiations continue, he also signaled potential penalties against countries that persist in buying Russian oil and military hardware.
In another attempt to put the screws on Moscow, Trump reduced the grace period for levying secondary sanctions on the purchasers of Russian exports from 50 days to only 10–12 days, barring a peace agreement.
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