• India’s ambassador to Russia confirms the nation will continue purchasing Russian crude based on commercial terms, prioritizing energy security.
  • The US is set to impose new punitive tariffs, escalating trade tensions in response to India’s oil imports.
  • Indian refiners are the primary beneficiaries of discounted Russian oil, though consumers have not seen lower fuel prices.

India will continue to purchase Russian oil despite significant pressure and new punitive tariffs from the United States, according to recent statements from India's ambassador to Russia, Vinay Kumar. The decision, officials emphasize, is driven by the imperative to source oil at the best commercial terms to ensure national energy security for its 1.4 billion citizens, not political considerations.

Ambassador Kumar reaffirmed that Indian companies will buy oil from wherever they can secure the “best deal,” which currently includes heavily discounted Russian crude. This stance comes as the US, under President Trump, prepares to impose an additional 25% tariff—totaling up to 50% on some goods—specifically targeting India’s continued Russian oil imports, according to policy documents seen by financial news outlets. The tariffs are scheduled to take effect on August 27.

Indian officials have rejected the US criticism, describing the impending tariffs as “unjustified and unfair.” The Ministry of Petroleum did not immediately respond to a request for further comment on the ambassador's remarks. The situation strains Indo-US relations, which have been challenged by differing positions on Russia’s war in Ukraine and broader trade tensions. Indian officials argue that the US focus on India is “unfortunate,” given that other nations also continue to purchase Russian oil in pursuit of their own economic interests.

The economic calculus for India is clear. Russia remains its largest oil supplier, accounting for a significant share of its total imports and roughly 38% of Russia’s own crude exports. The pivot to Russian oil, sparked by discounts following Western sanctions on Russia, is estimated to have saved India between $10.5 billion and $25 billion from 2023 to 2024. However, these savings are modest relative to India's $4 trillion GDP, and the broader macroeconomic impact is limited. The main beneficiaries have been Indian refinery companies, which have enjoyed improved margins; those savings have not been passed on to consumers at the pump.

Market data reflects the ongoing volatility. July 2025 saw Indian crude imports fall to an 18-month low, a move some analysts attribute to anticipation of the US tariffs and broader market instability stemming from the Israel-Iran conflict. Indian state-run refiners, however, continue to secure Russian oil contracts, and the country is expected to seek alternative buyers for its exports targeted by the new US duties.

Looking ahead, the India-Russia oil partnership is likely to persist unless a major external pressure, such as a coordinated international sanctions regime, significantly alters the dynamics. Some analysts anticipate ongoing volatility in oil import patterns due to both geopolitical developments and shifting discount dynamics in global markets. For now, India sees its continued cooperation with Russia as a means of promoting stability in global energy markets, even as its trade relationship with the US faces a new test.