The debate over India’s continued purchase of Russian crude oil has intensified in 2025. The United States has increased pressure on New Delhi to reduce its dependence on Russian energy, linking the issue to trade penalties and broader geopolitical tensions. Despite this, India continues to focus on its own energy needs, economic stability, and longstanding strategic approach to foreign policy.
India is the thirdlargest oil importer in the world. Domestic energy demand is extremely high, while domestic production is limited. This makes affordable oil imports critical for maintaining economic stability.
Russian crude oil became especially important for India after the RussiaUkraine conflict began in 2022. As many Western nations reduced their purchases of Russian energy, Moscow offered oil to India at a significant discount.
In the first half of 2025, India imported around 1.75 million barrels of Russian crude per day, which accounted for roughly 35% of its total oil imports. Even after a slight decline in July 2025 to 1.6 million barrels per day, Russia remained India’s top supplier, ahead of Iraq, Saudi Arabia, and the United Arab Emirates.
These purchases are not just about maintaining energy supplies; they help control fuel prices domestically. Cheaper crude allows Indian refiners to maintain profitability and keeps petrol and diesel costs manageable for consumers, reducing the risk of inflation.
The United States has repeatedly expressed concern about India’s continued imports of Russian oil. Washington argues that this trade indirectly supports Moscow’s war effort by providing it with critical energy revenue.
In July 2025, the US imposed a 25% tariff on Indian goods, signaling its dissatisfaction. American leaders warned of further penalties, including much higher tariffs on a broader range of Indian exports. Some US lawmakers even suggested secondary sanctions that could go as high as 500% on nations that continue purchasing large volumes of Russian oil.
The pressure is not limited to trade. Washington has also raised the possibility of targeting Indian companies involved in deals with Russian firms and hinted at reviewing other aspects of the bilateral trade relationship. This has created a tense situation where New Delhi must balance its economic needs with the risk of financial penalties from its largest trading partner.
So far, India has shown no signs of changing its official policy on Russian crude imports. Government sources have confirmed that no order has been issued to oil companies to cut their purchases from Russia.
The occasional dip in imports has been linked to market conditions, not political pressure. For example, when the discount on Russian oil narrows or shipping costs increase, refiners sometimes pause new orders. When the economics improve again, purchases resume.
India has also defended its position publicly. Officials have stressed that energy security cannot be compromised and that every nation has the right to choose its energy suppliers based on its economic interests. New Delhi has criticized Western nations for what it views as double standards, noting that Europe itself continues certain forms of trade with Russia while expecting India to cut ties completely.
Energy Security and Price Stability: India’s economy depends heavily on affordable oil. Switching away from Russian crude would mean buying more expensive oil from other suppliers like the US, Saudi Arabia, or Iraq. Analysts estimate that abandoning Russian crude could raise India’s annual oil import bill by $9–11 billion, which could lead to higher fuel prices and inflation.
Strategic Autonomy; India has always followed an independent foreign policy. It prefers to avoid aligning completely with any one global power, whether the US, Europe, or Russia. Yielding to US pressure could be seen as compromising this principle of strategic autonomy.
Long-Standing IndiaRussia Relations: Russia has been a key partner for India for decades, not just in energy but also in defense and technology. Maintaining this relationship is important for both strategic and economic reasons.
Limited Economic Damage from Tariffs: Even if the US raises tariffs, India’s economy can absorb the impact to some extent. While it could affect exporters, the overall hit to GDP is expected to be small compared to the cost of giving up discounted Russian oil.
Replacing Russian oil completely is not easy. India has diversified its sources in recent months, buying small amounts of crude from the US and other regions. But these are shortterm adjustments, not a longterm strategy.
Global oil markets are tight, and Russian barrels offer flexibility to Indian refiners. If the discounts remain attractive, India has little incentive to make a complete shift.
Several factors will determine India’s future stance:
Size of the Discount on Russian Oil: If Russia continues to offer attractive discounts, India will likely keep buying. A significant reduction in price benefits could lead to natural diversification without direct US influence.
Severity of US Penalties: If the US imposes extremely high tariffs or secondary sanctions, India might look for ways to balance its imports. However, moderate penalties alone may not be enough to force a policy change.
Global Oil Supply Changes: If other suppliers offer better deals or if geopolitical tensions ease, India could reduce dependence on Russia gradually without appearing to bow to US pressure.
As of August 2025, the official stance remains firm. India will continue to prioritize its own energy security and economic stability over external pressure. The government appears willing to face moderate trade risks rather than disrupt the supply of affordable energy.
Domestic Economy: Continued access to cheap Russian oil helps keep inflation under control and supports industrial growth. Any forced shift could make fuel costlier, affecting transport and production costs across the economy.
IndiaUS Relations: The dispute highlights the limits of the growing IndiaUS partnership. While both nations share interests in countering China and expanding trade, energy politics has created visible friction.
Global Energy Politics: India’s stance sends a message to other major oil buyers that independent energy policies are possible even under pressure from major powers. This could encourage other countries to explore similar arrangements with alternative suppliers.
India is unlikely to bow down immediately to US pressure on Russian oil imports. The decision is guided by energy affordability, economic stability, and strategic independence. Unless the US escalates penalties to an extreme level or Russian discounts vanish, India will maintain its current policy.
This standoff reflects the changing dynamics of global energy politics. National interest and economic realities are proving stronger than external pressure, and India appears prepared to absorb shortterm trade challenges to protect longterm energy security.