Indian Refiners Await Government Guidance on Halt to Russian Oil Imports

By [Your Name], Local Media Correspondent
Indian oil refiners are waiting for clear instructions from the federal government before they can fully halt imports of Russian crude oil, industry sources said. This highlights the complexity of unwinding supply contracts and the challenges facing New Delhi in balancing geopolitical pressure with energy security. The comments come after a recent U.S.–India trade deal that included a provision to stop buying Russian oil, but so far no formal directive has been issued by Indian authorities.
Under the framework of the trade agreement announced in early February, U.S. President Donald Trump said India agreed to end its purchases of oil from Russia in exchange for steep cuts in U.S. tariffs on Indian goods — from around 50 percent down to 18 percent. However, Prime Minister Narendra Modi welcomed the tariff reduction without publicly confirming any commitment to halt Russian oil imports.
Several refining executives, speaking on condition of anonymity because they were not authorized to brief the press, said Indian refiners have already booked shipments of Russian crude that are scheduled to load in February and arrive in March. Until these contracts are honored, refiners say they will need a “wind‑down period” to adjust to any new policy.
A Gradual Transition Rather Than an Immediate Stop
India became one of the world’s largest purchasers of Russian seaborne crude after Moscow’s invasion of Ukraine in February 2022, taking advantage of steep discounts on Russian barrels sidelined by Western buyers. At peak levels, Russian oil accounted for a significant share of India’s total crude imports, helping keep the country’s energy costs down.
Despite pressure from Washington and ongoing sanctions from the EU and U.S., New Delhi has been cautious in abruptly cutting off a key source of crude that fuels its expanding economy. Industry sources said a full and immediate halt to Russian oil purchases would not only disrupt refinery operations but also have broader implications for domestic fuel markets and energy prices. Refineries like Nayara Energy’s 400,000-barrel-per-day Vadinar plant have historically relied heavily on Russian crude, and abrupt changes could create operational bottlenecks.
Refiners Hold Back New Orders, Await Policy Direction
Many Indian refiners have paused placing new orders for Russian crude, waiting for firm government guidance before committing to future cargoes. The refining sector is already under pressure from shifting global oil markets, and uncertainty around supply relationships adds to operational challenges.
A complete halt to Russian crude imports could have financial implications for private players with long-term contracts with Russian suppliers. Reliance Industries — India’s largest refiner — has publicly said it plans to resume limited Russian crude purchases while evaluating policy impact. Some state-run refineries have slowed or halted new cargo bookings as they assess the situation.
Refiners also emphasize that switching supply sources is not simple. Heavy crude grades from Russia are uniquely suited to some Indian refineries’ configurations, and alternatives from the Middle East, Africa, or the United States may not always match operational requirements.
Government Response: Cautious and Measured
India’s oil ministry has so far not issued a formal policy statement instructing refiners to stop Russian oil imports. A spokesperson from the Ministry of External Affairs reiterated that India’s energy policies are dictated by national interests and the need to maintain affordable fuel for consumers and industry alike. Officials, however, hinted that diversification of crude sources is underway.
Western pressure — particularly from the United States — has intensified in recent months. The Trump administration has urged India to increase oil purchases from U.S. producers and Venezuela, a move that could reshape global crude-supply patterns.
However, analysts note that the transition away from Russian crude may not immediately boost U.S. imports. Refiners with limited capacity to process lighter grades might find alternative heavy crudes — including Venezuelan grades — only a partial substitute.
Economic and Geopolitical Stakes
Russian oil imports sit at the intersection of economics and geopolitics for India. On one hand, Russian barrels offer cost advantages that support competitive fuel pricing domestically. On the other, aligning with the United States could secure lower tariffs for Indian exports, incentivizing New Delhi to consider Washington’s broader geopolitical objectives.
Moody’s Ratings warned that an immediate disruption to India’s Russian oil imports could ripple through the economy, leading to higher energy costs and inflationary pressures if alternative supplies are not secured swiftly.
The Road Ahead: Policy Decisions Awaited
As the standoff continues, Indian refiners navigate a period of uncertainty. With existing commitments to Russian cargoes to be fulfilled in the short term, the industry is effectively in a holding pattern until New Delhi articulates a definitive policy direction.
Industry watchers say the eventual shape of India’s crude oil import portfolio — including the pace of reduction in Russian imports — will have significant implications for global oil markets, energy diplomacy, and India–U.S. relations.
For now, Indian refiners say they need clarity and time — a wind‑down period to transition away from Russian markets if and when the government mandates it. Absent clear instruction, they will continue fulfilling existing contracts while cautiously adapting to evolving geopolitical dynamics.