India’s Russian oil imports likely to hold steady after Trump’s sanctions waiver

• India’s Russian crude imports are expected to remain near current levels after Donald Trump waived sanctions and tariffs under a new US law.

• Kpler expects Indian purchases to reach around 1.8–1.9 million barrels per day in October, below the peaks recorded in June and July.

• Discounted Russian supplies remain attractive to refiners, with Urals crude averaging $23 a barrel below Brent in September.

India is expected to maintain Russian crude purchases close to current levels after US President Donald Trump waived sanctions and tariffs prescribed under a new law targeting major importers of Russian energy, analysts said.

Trump issued an executive order late on Friday, 16 October, suspending the sanctions, restrictions and duties provided for under the Lindsey O. Graham Sanctioning Russia and Iran Act. The decision came a day before a 30-day enforcement deadline expired. He had signed the legislation on 18 September.

The law authorised tariffs of up to 100 per cent on goods from the five largest importers of Russian crude and gas, alongside sanctions targeting Russia’s shadow fleet of tankers. The waiver applies broadly rather than exclusively to India and could also benefit China. The administration retains the option of revisiting the decision.

Analysts expect the relief to allow Indian refiners to continue sourcing Russian crude without an immediate disruption arising from the legislation, The Hindu reported.

Ship-tracking data showed that India has averaged about 1.8 million barrels per day of Russian seaborne crude imports this year, making it the largest buyer ahead of China, at around 1.2 million barrels per day. Italy, Turkiye and the Netherlands rounded out the five largest importers.

India bought approximately 1.82 million barrels per day in September, compared with China’s 1.49 million. Kpler expects Indian imports in October to remain in the range of 1.8–1.9 million barrels per day.

Those volumes are considerably below the mid-year highs. Indian purchases reached 2.6 million barrels per day in June and 2.57 million in July.

Price discounts continue to underpin demand. Urals-grade Russian crude traded at an average discount of $23 a barrel to Brent in September, analysts said, supporting its appeal against supplies from West Asia and other producing regions. Russian cargoes also helped replace supplies disrupted by the Iran war earlier this year, they added.

India’s reliance on Russian oil expanded rapidly after Moscow’s invasion of Ukraine in February 2022. Western sanctions and the withdrawal of several traditional buyers pushed Russia to seek alternative markets, offering substantial discounts to attract Asian refiners.

The European Union prohibited seaborne imports of Russian crude, while the G7 introduced a price cap intended to restrict Moscow’s earnings without removing its oil from global markets. Discounts on Russia’s Urals grade approached $40 a barrel at times in early 2023.

Before the war, Russia supplied around 2 per cent or less of India’s crude imports. Its share subsequently rose sharply, at times reaching approximately 40–50 per cent, as refiners sought cheaper feedstock to improve margins and manage energy import costs.

The change also supported India’s refined fuel exports. Domestic refiners processed Russian crude into products such as diesel for sale both within India and overseas. Although buying patterns have varied with prices, availability and geopolitical pressures, Russia has become central to the country’s crude sourcing.

The latest waiver follows a US Treasury decision on 9 October permitting the sale and import of Russian diesel into global markets, including the United States, until 7 April 2027. Analysts said that earlier exemption had already reduced the likelihood of the new law being enforced.

With agency inputs