India's Russian Oil Imports Dip 5.4% to 1.60 Million Barrels Per Day in September Amid US Tariffs and Trade Talks

In a notable shift within India's oil sector, state-owned refiners are scaling back their purchases of Russian crude oil amid intensifying pressure from the United States, while private companies are ramping up their procurement of the discounted supplies.

This divergence comes as the US pushes India to reduce its reliance on Russian energy to undermine Moscow's funding for the war in Ukraine.

According to recent data, India's overall imports from Russia dipped slightly in September, but the strategies adopted by public and private players highlight differing priorities in balancing economic benefits with geopolitical considerations.

State-run companies such as Indian Oil Corporation (IOC) and Bharat Petroleum Corporation Limited (BPCL) have been actively diversifying their crude oil sources. Provisional vessel tracking data from Kpler indicates that India's Russian oil imports fell to 1. 60 million barrels per day in September, marking a 5. 4 per cent decline from August levels.

This reduction is largely attributed to state refiners, who have increased purchases from alternatives like the United States, Saudi Arabia, and Iraq.

A report from The Times of India notes that these firms are responding to US tariffs imposed on Indian goods, which the Trump administration has linked to curbing Russian oil flows. Indian representatives have countered by requesting access to sanctioned oil from Iran and Venezuela to offset potential shortfalls, emphasizing the need for affordable energy to fuel the nation's growing economy.

This approach underscores the economic allure of Russian oil, which remains competitively priced even under Western sanctions. New Delhi continues to prioritize price-driven deals, with officials stating that Russian supplies have helped stabilize global markets and keep domestic fuel prices in check.

Finance Minister Nirmala Sitharaman has publicly affirmed that India will not halt these purchases, highlighting the country's self-respect and long-standing ties with Russia. The US pressure has escalated through trade negotiations, where American officials have tied tariff reductions and a potential bilateral deal to India's willingness to limit Russian imports.

Data from Vortexa suggests that despite the tariffs, interest in Russian crude remains strong among Asian buyers like India and China, with imports nearing €2. 9 billion in August.

This resilience is evident in the private sector's strategy, where firms are not only maintaining but expanding their Russian portfolios to ensure energy security amid fluctuating global prices.

It is worth noting that this split in approaches could have broader implications for India's energy landscape. State refiners' diversification efforts include securing at least 22 million barrels of non-Russian crude for September and October deliveries, as per trade sources cited in Reuters.

On the other hand, private entities are navigating the discounts—sometimes up to $10 per barrel below market rates—to bolster their refining margins. Analysts observe that while the slight September dip shows some impact from US talks, no meaningful reduction in overall volumes is visible yet, with Russian oil still central to India's crude slate.