India will restrict crude oil purchases from Russia and limit imports only to cases where supplies are irreplaceable, as part of a broader understanding reached with the United States to secure lower trade tariffs, sources quoted by news agency PTI claimed.
While no immediate blanket ban is planned, Indian refiners will not place fresh orders for Russian crude once existing contractual commitments are honoured, the sources said.
The move follows US President Donald Trump’s announcement that Washington would reduce reciprocal tariffs on Indian goods to 18 per cent from 25 per cent.
Trump said the tariff relief was linked to India agreeing to stop buying Russian oil, lower tariff and non-tariff barriers, and commit to purchasing an additional $500 billion worth of US energy, technology, agricultural products and other goods over time.
The understanding effectively removes an additional 25 per cent punitive tariff that had been imposed over India’s Russian oil purchases, bringing down the applied US tariff on Indian exports from 50 per cent to 18 per cent and providing significant relief to exporters.
Refiners to wind down, no new Russian orders
Indian refiners, which emerged as the world’s second-largest buyer of Russian crude after Moscow’s invasion of Ukraine in February 2022, will continue to honour purchase commitments made before the announcement but will not place new orders thereafter, three people with knowledge of the matter said, as per PTI.
State-run refiners such as Hindustan Petroleum Corporation Ltd (HPCL), Mangalore Refinery and Petrochemicals Ltd (MRPL) and HPCL-Mittal Energy Ltd (HMEL) had already stopped buying Russian oil after the US imposed sanctions last year on key Russian exporters.
Others, including Indian Oil Corporation (IOC) and Bharat Petroleum Corporation Ltd (BPCL), are expected to gradually wind down their purchases.
Reliance Industries Ltd, India’s biggest buyer of Russian crude, had paused purchases late last year following US sanctions on Rosneft and Lukoil.
Reliance is also likely to stop buying Russian oil again after the delivery of its resumed cargo of 100,000–150,000 barrels.
Nayara Energy likely exception
The only likely exception to the restriction is Nayara Energy. Nayara has been sanctioned by the European Union and the UK due to its Russian links, with Rosneft holding a 49.13 per cent stake.
Because of these sanctions, other major suppliers are unwilling to transact with the company, leaving it dependent on Russian crude sourced from non-sanctioned entities, sources said.
As per PTI, Nayara’s unique position was explained to US trade officials during talks in December, and New Delhi may seek an exemption or special dispensation for the refinery under the “no Russian oil” policy. Nayara is expected to continue limited purchases in the near term.
Trade deal, export relief and oil math
Trump said India has also agreed to import $500 billion worth of US goods, including energy, agriculture and technology products, over five years.
In 2025, India exported $92 billion worth of goods to the US, accounting for 20 per cent of total exports, while imports from the US stood at $50 billion, or about 7 per cent of total imports.
India’s total oil import bill stood at $180 billion, with about 30–35 per cent sourced from Russia, compared with 20–30 per cent from Iraq, 15 per cent from Saudi Arabia, 10 per cent from the UAE and 5–10 per cent from the US.
Russian imports already declining
Russian oil imports have been declining since US sanctions on Rosneft and Lukoil came into force. Imports averaged 1.2 million barrels per day in December 2025, down from a peak of 2.1–2.2 million barrels per day.
In January, they fell further to around 1 million barrels per day and were expected to drop below that level soon. Under the new understanding with Washington, imports could halve in the coming months.
However, market analysts see limited immediate impact. Sumit Ritolia, lead research analyst at Kpler, said the India–US trade deal is “unlikely to result in a near-term reduction” in Russian crude imports.
“Russian volumes remain largely locked in for the next 8–10 weeks and continue to be economically critical for India’s complex refining system,” Ritolia was quoted as saying by PTI, adding that imports are expected to remain in the 1.1–1.3 million barrels per day range through early Q2.
Diversification and Venezuela option
Prashant Vasisht of Icra said the reported deal includes India stepping up purchases of US crude and potentially resuming imports from Venezuela.
“Russian crude accounted for less than 2 per cent of Indian crude imports prior to FY2023, so replacement options exist,” he said, adding that switching to market-priced crude would raise India’s import bill by less than 2 per cent.
Venezuelan crude, being heavy and sour, could also suit Indian refineries, he noted.
Russia’s response
Meanwhile, Russia has said it has not received any official communication from India on halting oil purchases. Kremlin spokesman Dmitry Peskov said, “So far, we haven’t heard any statements from New Delhi on this matter”.
Prime Minister Narendra Modi, while confirming the tariff cut as a boost for “Made in India” exports, also did not publicly mention Russian oil.
Industry sources quoted by Reuters have said refiners will need a wind-down period to meet existing contracts, underlining that any shift away from Russian oil will be gradual rather than abrupt.
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