NEW DELHI: Indian refiners are set to sharply curtail imports of Russian crude to comply with new US sanctions on Rosneft and Lukoil, industry sources said, potentially clearing a hurdle to a trade deal with Washington.
India faces 50% tariffs on exports to the United States, with half imposed in retaliation for Russian oil purchases. New talks could align tariffs with Asian peers if New Delhi winds down Russian crude imports.
India has been the largest buyer of discounted seaborne Russian oil since Moscow’s 2022 invasion of Ukraine, averaging about 1.7 million barrels per day in the first nine months of this year.
Reliance Industries, India’s biggest buyer of Russian crude, plans to reduce—or possibly halt—purchases, two sources said. “Recalibration of Russian oil imports is ongoing and Reliance will be fully aligned to Government of India guidelines,” a company spokesperson said.
State refiners Indian Oil, Bharat Petroleum and Hindustan Petroleum are reviewing documentation to ensure no cargoes originate directly from Rosneft or Lukoil following the sanctions, a source with direct knowledge said. India’s oil ministry and the companies did not immediately comment.
“There will be a massive cut,” a refinery source said. “It won’t go to zero immediately as some barrels may come via intermediaries.”
US President Donald Trump on Wednesday announced Ukraine-related sanctions on Russia for the first time in his second term, targeting Lukoil and Rosneft. The US Treasury set a Nov. 21 deadline to wind down transactions with the sanctioned producers. “It all depends on banks,” another Indian refinery official said. “If banks clear payments, we will buy. Otherwise my intake will be zero.”
Reliance, controlled by Mukesh Ambani, operates the world’s largest refining complex at Jamnagar and has a long-term deal for nearly 500,000 barrels per day from Rosneft, alongside purchases via intermediaries. In recent days it has bought spot cargoes from the Middle East and Brazil and was in the market on Thursday for additional supplies, traders said.
Before the US move, Reliance was considering stopping Russian crude for one export-oriented refinery ahead of a European Union ban on products made from Russian oil starting in January, a source said.
Nayara Energy, part-owned by Rosneft, also buys Russian oil. State refiners typically source via intermediaries. Brent crude rose more than 3% on Thursday. — Reuters
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