The flow of Russian crude oil to Indian refiners could drop precipitously after the Trump administration targeted Rosneft and Lukoil with fresh sanctions on Wednesday.
Bloomberg reported the news, citing unnamed executives from India’s refining industry, who noted that local refining majors such as Indian Oil Corp., Bharat Petroleum Corp., and Hindustan Petroleum Corp. buy Russian crude on the spot market, while another major, Reliance, has a long-term supply deal with Rosneft.
Russian crude currently accounts for a third of India’s total imports of the commodity. Cutting such a large portion of supply would inevitably push international prices higher, although how much higher is an open question amid a broadly shared perception of a massive glut. Despite the glut expectations, prices immediately jumped on the news of the new sanctions, with Brent crude adding over $2 per barrel earlier today.
President Trump has been trying to curb Russian oil exports as a way of reducing the country’s financial strength to get it to agree to a ceasefire in Ukraine. The effort has focused on India, which has much better relations with the U.S. than the other large buyer of Russian crude, China. Yet India has repeatedly indicated it would not give in to pressure, which included additional tariffs on Indian imports into the U.S. and threats of more.
U.S. sources from the federal government have been telling media that, despite public statements, Indian buyers of Russian crude have already started reducing purchases, and President Trump himself said earlier this week—again—that India’s Prime Minister Narendra Modi had promised to stop buying Russian oil.
Meanwhile, Bloomberg reported this week that Russian maritime oil exports had reached the highest since early 2023 over the last four weeks, at a daily average of 3.82 million barrels, despite the rising pressure on importers to suspend purchases.
By Irina Slav for Oilprice.com
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