An oil refinery operated by Bharat Petroleum Corp. in Mumbai, India.
Dheeraj Singh | Bloomberg | Getty Images
India’s state-owned refiners are still buying Russian crude even as New Delhi seeks relief from U.S. tariffs imposed on these purchases, energy analysts said.
The United States imposed a 25% “secondary” tariff on Indian goods in August because New Delhi continued to import Russian crude oil. In late November, the US government also imposed sanctions on Russian oil companies Lukoil and Rosneft.
On Sunday, U.S. Sen. Lindsey Graham claimed that India’s U.S. Ambassador Vinay Mohan Kwatra had asked President Donald Trump to remove these tariffs and that New Delhi had reduced its purchases of Russian crude oil.
India’s overall demand for Russian crude fell in December, but analysts said the decline was mainly driven by lower purchases of Mukesh Ambani-owned crude. Reliance IndustriesThe company was a major importer before U.S. sanctions against Lukoil and Rosneft took effect in late November.
Analysts added that state-owned refiners, known as public sector undertakings (PSUs), were offsetting some of the decline in Russian crude oil prices.
Indian state-owned enterprises IOC (Indian Oil Corporation) and BPCL “Bharat Petroleum Corporation continues to purchase Russian crude for future deliveries through non-licensed suppliers,” said Muyu Shu, senior crude oil analyst at tanker tracking firm Kpler.
BPCL declined to comment, but the IOC and Hindustan Petroleum CorporationIndia’s Ministry of Petroleum and Natural Gas also did not respond to a request for comment from CNBC.
India faces continued pressure from the United States to cut oil imports from Russia, which is its economic lifeline to withstand Western sanctions over its war with Ukraine.
“Despite the decline in total imports, PSU refinery uptake of Russian crude remains resilient, highlighting redistribution rather than demand collapse,” said Pankaj Srivastava of Rystad Energy.
Rystad estimates that India’s imports of Russian crude oil have fallen by about 300,000 barrels per day since November to 1.7 million barrels per day from the previous quarter.
However, it expects a “moderate recovery” to 1.8 million barrels per day in January.
“We are seeing a slight uptrend as public sector refiners continue to process Russian crude due to domestic fuel demand and price economics,” said Srivastava, senior vice president of commodity markets at Rystad Energy.
The Kupler data also showed a decline in Russian oil imports by India.
According to Kpler, “India’s Russian crude oil imports fell by 595 kbpd month-on-month in December to 1.24 million barrels per day, the lowest level since December 2022.”
On Sunday, President Trump told reporters aboard Air Force One that the United States could raise tariffs on India if New Delhi fails to curb its purchases of Russian oil.
