India’s Russian oil imports: a complex picture of contradictory claims

Despite Western claims to the contrary, India is still happy to import Russian crude.

What: Indian imports of Russian crude – despite sanctions – are not as clear-cut as they might at first appear.

Why: When allowing for official state-backed imports and market economy efforts at self preservation by private refiners, the waters start to muddy.

What next: In the short term, India to at least appear to be breaking records in terms of crude import numbers. In the long-run – it all depends on what best suits New Delhi.

Indian refiners appear set to take in substantial volumes of Russian crude this December, confounding predictions that new Western sanctions would sharply curtail flows. At present, official and market data point to arrivals of Russian oil into India reaching around 1.85mn barrels per day, a level that would represent the highest in six months, with some delivery schedules already cemented, Reuters reports. This trend extends a pattern seen over recent months, even as the United States and its allies tighten restrictions on Russia’s energy exports and continue to claim India will soon start cutting supplies from Moscow.

At first glance, the persistence of heavy buying looks like a slap in the face for US-led sanctions efforts. But with discounted Russian crude remaining highly attractive to refiners in India, the world’s third-largest oil importer, beneath the aggregate numbers lies a fractured reality in which buyers diverge, strategies differ and policy signals continually contradict one another.

The headline figure of roughly 1.85mn barrels per day in December disguises a rebalancing among Indian companies. According to recent reporting, state-controlled entities have maintained or even increased Russian purchases, whereas major private refiners such as Reliance Industries have sharply reduced their volumes in response to Western sanctions and compliance concerns, Reuters adds.

Nayara Energy, for example, is reportedly set to receive cargoes at its Vadinar terminal well above its nominal processing capacity, hinting at stockpiling or speculative retention of discounted barrels rather than immediate refining. By contrast, Reliance’s Russian imports are forecast to be significantly lower this month than at their peak in the summer. Such diverging strategies reflect a significant degree of evolving risk assessments within India’s energy sector.

Private refiners with substantial overseas exposure have weighed the reputational and financial costs of breaching secondary sanctions more heavily than some of India’s state-run firms, which are more focussed on securing reliable supplies for domestic markets.

Western sanctions: bite, bark or something in between?

In late November, much was made of Washington imposing new sanctions on Russia’s two largest oil producers, Rosneft and Lukoil. The move came about as part of a Trump administration effort to squeeze Kremlin revenues and constrain its war-waging capacity. In turn this fed expectations - and led to media headlines - that global flows to major buyers such as India would plunge.

The result, however, has been somewhat more ambiguous.

While Rosneft’s and Lukoil’s direct shipments abroad have declined of late, deliveries from non-sanctioned Russian producers have compensated for some of that shortfall, rising by roughly 500,000 barrels per day (bpd) over the same period. This has thus allowed Indian refiners to sustain overall volumes even as sanctioned entities are in fact scaled back.

But not all Western indicators point in the same direction: according to an October 17 piece by Reuters, a senior White House official asserted that India had already reduced Russian oil purchases by around half, a claim that Indian industry sources immediately contested, insisting that there had been “no immediate reduction”.

This discrepancy underscores how political posturing and market realities often diverge.

Further complicating the landscape, the European Union has in recent days introduced its own fresh set of sanctions designed to clamp down on the so-called “shadow fleet” of shipowners and intermediaries that help to move Russian crude while obscuring its origin.

These multifaceted restrictions, aimed at both energy producers and the logistics that sustain them, only serve to add layers of compliance complexity for buyers worldwide.

Amid these cross-currents, India’s political leadership has underscored the ever more obvious transactional nature of its energy relationship with Moscow. In recent talks between Prime Minister Narendra Modi and President Vladimir Putin, officials emphasised the uninterrupted nature of energy supplies, presenting them as a symbol of stable bilateral ties as opposed to an affront to Western sanctions.

New Delhi’s stance is that it adheres solely to United Nations sanctions obligations, a position that gives it latitude to source energy as it sees fit. This posture has annoyed some policymakers in Washington and across the Atlantic in Brussels. So much so that some have suggested that India’s approach reflects a broader challenge to the Western-led sanctions coalition.

Contradictions at the macro level

The broader economic context adds further nuance to an already confusing issue. India’s overall trade balance has shown signs of improvement. Much of this improvement is tied to shifts in crude purchasing methods, including a greater emphasis on Middle Eastern grades and increased export performance in non-energy sectors.

Nevertheless, the energy relationship with Moscow remains pivotal. According to independent trackers, Russia continues to be one of India’s largest oil suppliers, accounting for a substantial share of imports even as volumes and sourcing patterns evolve – regardless of claims to the contrary by Donald Trump and European political leaders.

As India enters 2026, its oil import strategy looks set to be shaped by a blend of economic pragmatism alongside geopolitical signalling and regulatory compliance. On the one hand, discounted Russian crude supplies offer a hedge against otherwise elevated global oil costs. On the other, sustained pressure from the US, EU and others is prompting private refiners - at least - to explore alternatives and diversify their baseload procurement.

To this end, the coming months will reveal whether India’s current import levels represent a temporary plateau ahead of a meaningful decline, or the emergence of a new norm in global crude flows that accommodates both Western sanctions and ongoing trade between Russia and Asia’s fastest-growing major economy.