Energy

India goes back to buying Russian oil

New Delhi addresses the energy crisis caused by the closure of the Strait of Hormuz by increasing imports of Russian crude oil despite higher costs and international political pressure

from our correspondent Marco Masciaga

7 March 2026

3' min read

Translated by AI

Versione italiana

3' min read

Translated by AI

Versione italiana

NEW DELHI - The United States on Thursday night gave India a one-month window to start buying Russian crude again and make up for the shortfall in oil deliveries from the Middle East after the closure of the Strait of Hormuz.

Wasted effort. India's refineries had already started sourcing from Moscow again. New Delhi's stocks of crude oil and refined products do not exceed 25 days, which means that there would be little or no time for crude oil to arrive in port that was not already on board a tanker, ready to be delivered to the highest bidder.

Since Israel and the US attacked Iran, Indian refineries have bought more than 10 million barrels of Russian crude oil, and - judging by the time the tankers started heading for the Subcontinent - they started doing so even before receiving the American green light. The purchases could continue in the coming days as well, since the 10 million barrels bound for India are only part of the 15 million on board tankers scattered between the Arabian Sea and the Bay of Bengal, to which another 7 million barrels stopped off Singapore should be added. Not to mention the huge quantities in transit through the Mediterranean Sea and the Suez Canal on their way to Asia.

Also hoarding Russian crude oil again are public giants like Mangalore Refinery and Petrochemicals and Hindustan Petroleum. The latter had been prudently staying away from Moscow's oil since last December. 'Refiners could quickly increase purchases again, pushing volumes above 2 million barrels per day in the short term,' explains Sumit Ritolia, an analyst at Kpler. Any return to that level would effectively bring Indian imports back to the peak recorded in mid-2024, equivalent to roughly double the level of a month ago.

Il cinismo dei mercati

The return to Russian oil purchases is relatively easy for Indian refineries because the plants are already optimised for that type of crude, but it is less convenient than it used to be. "The large discounts observed earlier," explains Ritolia, "could be significantly reduced. A month ago, Ural crude was bought at a discount of $15-20 per barrel compared to Brent, whereas today it costs $2 to $4 more.

The crisis that erupted a week ago in the Middle East is likely to have multiple economic and political repercussions for New Delhi. The rise in the price of oil and its derivatives, such as fertilisers used massively by Indian farmers, is bound to reverberate not only on inflation, but also on foreign exchange reserves. An item in the state budget that in the coming weeks could be put under further pressure by the inevitable contraction of remittances. This flow of money is worth almost 3.5 per cent of India's GDP and last year brought $135 billion to India, 38 per cent of which came from Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

On the political front, the situation promises to be no less complex. Prior to Trump's arrival in the White House, New Delhi had had good luck turning the period of strong global instability in its favour by significantly lowering its energy bill. But the US administration first punished India with tariffs and then got it to stop buying Russian oil, forcing it to diversify towards the Middle East. Then, by attacking Iran, it forced it to look for alternative sources, until it magnanimously allowed it to go back to buying Russian oil. A move that dispelled some legal doubts, but again gave the feeling of an Indian government at the mercy of a foreign power. A bitter chalice for any executive in any corner of the planet, but real poison for a proudly nationalist government like the one led by Prime Minister Narendra Modi, who never misses an opportunity to emphasise his own enfranchisement from India's colonial past and to reiterate New Delhi's growing centrality in the global political balance.

Not to mention the more mundane repercussions. The Indian government yesterday ordered that all butane and propane gas reserves in the country be used in the production of LPG for domestic consumption. In a country where elections are also won by giving gas canisters to housewives, not even charging for them would be politically suicidal.

Marco MasciagaCorrispondente da New Delhi
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Luogo: New Delhi
Lingue parlate: Italiano, inglese
Argomenti: Asia del Sud
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