After the trade agreement with America, India can now gradually reduce the purchase of crude oil from Russia. According to sources, the central government is planning on this after America removes the 25 percent additional tariff imposed on India. US President Donald Trump signed an executive order in this regard on Friday and said that this step has been taken after India’s commitment to stop Russian oil imports. However, this import will not stop completely yet as some refineries like Nayara Energy have limited other options.
Informal orders given to refineries
According to sources, Indian refineries have not yet received any formal order to completely stop purchasing oil from Russia, but have been informally asked to reduce purchases. Oil orders are usually placed 6 to 8 weeks in advance, so previously agreed deals will be fulfilled, but new orders will not be placed.
Companies like Hindustan Petroleum, Mangalore Refinery and Petrochemicals and HPCL-Mittal Energy have stopped buying Russian oil after the India-US deal. At the same time, Indian Oil Corporation (IOC) and Bharat Petroleum (BPCL) are now gradually reducing their purchases.
The country’s biggest buyer Reliance Industries also stopped purchases last year following US sanctions on Rosneft and Lukoil. However, a consignment of 1.5 lakh barrels was restarted, which is scheduled to be delivered in the next few weeks. After this, Reliance is also likely to stop purchasing completely.
Nayara Energy needs exemption
Naira Energy is emerging as an exception in this entire system. Sanctions were imposed on Naira first by the European Union and then by Britain regarding relations with Russia. Russia’s Rosneft holds 49.13 percent stake in the company. Due to these sanctions, no other major supplier is willing to trade with Naira, so the company has to buy oil from non-sanctioned Russian companies. According to sources, information about this special situation was given to US trade officials in December. In such a situation, Naira may be given exemption or special arrangement from the policy of not buying oil from Russia.
Imports from Russia are already declining
Sources said India’s oil imports from Russia are already declining after the US imposed sanctions on Rosneft and Lukoil. Imports averaged 1.2 million barrels per day in December 2025, much lower than the peak of 2.1 million barrels per day in May 2023. In January it came down to 11 lakh barrels per day. It is estimated that in February or March it may go below 1 million barrels per day. After the new agreement with America, it may fall by half.
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India fulfills about 90 percent of its crude oil needs through imports. Due to sanctions imposed by Western countries after Russia’s attack on Ukraine, Russia sold oil at cheaper prices, which helped India reduce its import bill.
What did the experts say?
Sumit Ritolia, Lead Research Analyst at Kpler, says that the India-US trade agreement will not lead to a major decline in oil imports from Russia in the near future. According to him, the supply of Russian oil for the next 8 to 10 weeks is already fixed. It is economically important for India’s complex refining system. Imports could remain between 11 and 13 million barrels per day through the first quarter and the beginning of the second quarter.
ICRA’s Prashant Vashishtha said that under this agreement, India can increase oil purchases from America and can also start importing from Venezuela. Before FY2023, Russia’s share in India’s total oil imports was less than 2 percent. Therefore, if oil from other sources is taken instead of Russian oil, the import bill will increase by less than 2 percent.
He also said that Venezuelan oil is heavy and sour, which is generally cheaper and many refineries in India are capable of processing it.
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