India Poised to Halt Its Russian Oil Purchases as New Sanctions Loom

Three‑year buying spree comes to an end

For the past three years, India has been acquiring Russian crude at heavily discounted rates, capitalising on the price gap created by Western sanctions on Moscow’s energy sector. The strategy helped keep domestic fuel prices lower than they might otherwise have been and filled a crucial gap in India’s oil imports.

U.S. sanctions set to take effect

Starting this Friday, a fresh round of U.S. sanctions will target the entities that facilitate the sale and transport of Russian oil. The measures prohibit American companies and their affiliates from dealing with designated Russian oil exporters and logistics firms, effectively cutting off the financial channels that have underpinned the discount deals.

Why the sanctions matter for India

India’s oil majors have relied on a network of banks, insurers and shipping firms that are now subject to the new restrictions. Without access to these services, the cost advantage of Russian crude is expected to disappear, forcing Indian refiners to look elsewhere for supply.

What India is likely to do next

Analysts predict that Indian companies will pivot back to more traditional sources such as the Middle East and the United States, even if it means paying higher prices. The government may also explore strategic reserves and longer‑term contracts to mitigate any short‑term volatility.

Broader implications

The end of the Russian oil bargain could have ripple effects across the global market, tightening supply and nudging crude prices upward. For India, the shift marks a return to a more conventional import mix, but also a reminder of how geopolitical moves can reshape energy trade dynamics.