Despite Trump’s Pressure, Indian Oil Continues Buying Russian Crude from Non-Sanctioned Entities

Despite renewed U.S. pressure, Indian Oil Corporation (IOC) — India’s largest state-run refiner — has continued its procurement of Russian crude oil, placing orders for five shipments scheduled for December delivery.

According to Reuters, IOC bought approximately 3.5 million barrels of ESPO crude from non-sanctioned Russian entities at prices comparable to Dubai benchmarks. The move comes shortly after U.S. President Donald Trump announced sanctions on Russia’s top oil firms — Lukoil and Rosneft, intensifying scrutiny on countries still importing Russian energy.

India’s Balancing Act

IOC’s decision reflects India’s strategy of balancing geopolitical pressure with energy security. While Indian refiners are expected to respect the U.S. sanctions, they have been permitted to continue sourcing crude from non-sanctioned Russian firms, provided transactions comply with international norms.

IOC Director (Finance) Anuj Jain confirmed during an analyst call that the company would continue purchasing Russian oil as long as it complies with all sanctions and price caps.

“We are not going to discontinue buying Russian crude as long as we are complying with the sanctions. It is not Russian crude that is sanctioned — it’s the entities and shipping lines,” Jain said.
“If a non-sanctioned entity offers crude within the price cap and approved shipping, we will continue to buy it,” he added.

Impact of US Sanctions

Following the latest U.S. sanctions, several Indian refiners — including Mangalore Refinery and Petrochemicals Ltd (MRPL), HPCL-Mittal Energy Ltd, and Reliance Industries — have paused Russian oil imports to avoid potential compliance risks.

However, IOC, which accounts for a significant portion of India’s total crude imports, has maintained that its operations fully adhere to international trade and price cap mechanisms.

Analysts note that while Rosneft, India’s largest Russian oil supplier (handling nearly 45% of India’s Russian crude imports), is under sanctions, it functions primarily as an aggregator, enabling continued supply through non-sanctioned intermediaries.

Why Indian Oil Is Still Buying Russian Crude

India remains one of the largest buyers of discounted Russian crude, a position it gained after Western nations imposed sweeping sanctions following Russia’s invasion of Ukraine. These restrictions significantly disrupted global oil supply chains, forcing Moscow to offer deep discounts to alternative buyers like India and China.

However, recent sanctions have caused Chinese state refiners to scale back imports, creating an opportunity for Indian refiners to secure cheaper ESPO crude shipments.

Economic and Strategic Context

• Energy Security: India imports nearly 85% of its oil needs, making cost-effective sourcing essential.
• Strategic Neutrality: India has maintained a non-aligned stance on the Ukraine conflict, balancing its strategic partnerships with both Washington and Moscow.
• Global Market Dynamics: Reduced Chinese demand has pushed ESPO crude prices lower, benefitting Indian refiners in the short term.

Conclusion

Indian Oil’s decision to keep importing Russian crude underscores India’s pragmatic approach — prioritizing energy affordability and stability over geopolitical pressure. While the U.S. has tightened sanctions on Moscow’s oil sector, New Delhi’s stance remains clear: as long as transactions comply with legal frameworks and price caps, Indian refiners will continue sourcing Russian oil to safeguard domestic energy security and economic interests.