New Delhi | India is expected to keep importing Russian crude at close to current levels after US President Donald Trump waived sanctions and tariffs mandated by a new law on major buyers of Russian oil, analysts said.
Trump issued an executive order late on Friday waiving the "sanctions, restrictions, and duties" under the Lindsey O. Graham Sanctioning Russia and Iran Act, a day before a 30-day deadline for enforcement expired. He signed the law on September 18.
The law authorised tariffs of up to 100 per cent on goods from the five largest importers of Russian crude and gas, and sanctions on Russia's shadow fleet of tankers. The waiver is not specific to India and could also benefit China. The order lets the administration reconsider it later.
India is the largest importer of Russian seaborne crude, averaging 1.8 million barrels per day this year, ahead of China at 1.2 million, ship tracking data showed. Italy, Turkey and the Netherlands completed the top five.
India imported about 1.82 million bpd of Russian crude in September compared to about 1.49 million by China. Kpler expects October imports to hold at around 1.8-1.9 million bpd. Volumes are well below mid-year highs. Indian imports peaked at 2.6 million bpd in June and 2.57 million bpd in July.
With the waiver, refiners are likely to continue buying Russian crude, analysts said.
Madhavi Arora, Chief Economist of Emkay Global Financial Services, said India faced potential tariffs of up to 100 per cent under this bill, as one of the top five global buyers of Russian oil.
Trump's move comes days after he announced the US would import diesel from Russia, in a bid to bring down domestic fuel prices ahead of the November midterms.
This move is similarly aimed at preventing Russian supply from going off the market and causing a further spike in global oil prices so close to the midterms, the economist added.
"This should be a sentimental positive for India; however, we note Trump's flip-flops towards Russia, as well as his general animosity towards India in his term so far, and thus caution that there may be more to come in this story post-midterms," Arora said.
Russian crude emerged as a bargain for Indian refiners after Moscow's invasion of Ukraine in February 2022 triggered Western sanctions and prompted many buyers to shun its oil. The European Union banned seaborne imports of Russian crude, while the G7 imposed a price cap aimed at curbing Moscow's oil revenues without disrupting global supplies.
With traditional buyers retreating, Russia redirected cargoes to Asia at steep discounts to benchmark Brent crude, at times approaching USD 40 a barrel for its Urals grade in early 2023.
India seized the opportunity, transforming its crude sourcing in a matter of months. Russian oil accounted for around 2 per cent or less of India's imports before the war, but refiners rapidly increased purchases as discounted cargoes improved processing economics and helped contain the cost of imported energy.
Russia went on to become India's largest crude supplier, at times accounting for around 40-50 per cent of the country's total imports.
The shift also created a lucrative export stream for Indian refiners, which processed Russian crude into fuels such as diesel for domestic consumption and overseas markets. Although purchases have fluctuated with prices, supply availability and geopolitical pressures, the rapid rise of Russian oil has fundamentally reshaped India's crude import mix, analysts said.
The discounts made Russian oil an attractive alternative to supplies from West Asia and other producers, they said, adding that Russia made up for volumes lost due to the Iran war disrupting supplies earlier this year.
In September 2026, the price discount on Urals-grade crude oil relative to the global benchmark Brent averaged USD 23 per barrel, analysts said.
The latest sanctions waiver follows a Treasury decision on October 9 to allow the sale and import of Russian diesel into the global market, including the US, until April 7, 2027. The diesel waiver made enforcement of the new law unlikely, analysts said.
