India Commits to Persisting in Buying Russian Oil
In the first half of 2025, India's Russian crude oil imports have reached an unprecedented level, accounting for 35-40% of the country's total imports. This significant shift in India's oil procurement strategy is a testament to the country's strategic decision-making and economic necessity.
Prior to 2022, Russian crude oil accounted for less than 2% of India's total imports. However, in 2023, the figure rose to 30-35%, and in 2025, India imports an average of about 1.7 million barrels per day of crude oil from Russia, which constitutes nearly 37% of India's total overseas crude oil imports.
Indian officials have firmly rejected characterizations of impropriety in buying Russian oil, emphasizing their adherence to international rules while pursuing national interests. They point out inconsistencies in the application of sanctions by Western countries and highlight that transactions with Russia comply with the G7-EU price cap mechanism.
India's refining capacity exceeds 5 million barrels per day, allowing it to capitalize on discounted crude. The refined products are primarily exported to Asian markets but also reach European destinations. This export activity contributes to the Indian economy, as refining constitutes legitimate value addition.
Despite substantial savings on crude imports, Indian consumers have seen limited direct benefits in retail fuel prices. Indian policymakers prioritize energy security as a non-negotiable national priority, and the strategic decision to increase Russian oil imports is a reflection of this.
The increase in Russian crude oil imports has also influenced broader producer group dynamics, reducing OPEC+ leverage over India. This strategic move is closely monitored by market experts, with recent oil price rally analysis suggesting that they are keeping a close eye on geopolitical tensions for sudden shifts in India's procurement strategies.
Noting that international trade rules permit the export of refined products, Indian officials have also highlighted the inconsistencies in the application of sanctions by Western nations, as many continue energy trade with Russia through various exemptions.
In summary, India's increased Russian crude oil imports are a strategic decision driven by economic necessity and energy security concerns. The country's adherence to international rules, its use of non-sanctioned financial channels, and its commitment to maintaining Russian crude oil purchases underscore its commitment to pursuing national interests while upholding international norms.
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