India's options narrow as Russian oil imports face new sanctions

New Delhi, 24 Oct 2025: India faces a complex situation regarding its options for buying Russian oil amid new U.S. sanctions on major Russian producers Rosneft and Lukoil.

According to a Reuters report, "India is set to curtail its Russian oil imports to comply with new US sanctions on two top Moscow-backed producers," and major Indian refiners are "reviewing documents of their Russian oil imports to ensure no supply will be coming directly from Rosneft and Lukoil".

Reliance Industries Ltd., which has a long-term deal to import 500,000 barrels per day from Rosneft, has announced it "will stop its Russian oil imports under the deal," aligning fully with the Government of India's guidelines. 

However, Indian state refiners like Indian Oil Corp., Bharat Petroleum Corp., and Hindustan Petroleum Corp. are exploring ways to continue Russian crude imports, possibly through intermediaries, as "there will be a massive cut" but "not going to zero immediately".

The broader challenge is economic and technical. Russian oil has been India's largest crude supplier, accounting for about 34% of total oil imports in 2025, and Indian refiners appreciate the relatively lower cost due to discounts. As one analysis noted, 

"Even with narrower discounts than in 2023, Russian barrels remain one of the most economical feedstock options available to Indian refiners" due to established supply chains and refinery configurations optimized for Russian crude. Cutting off Russian oil abruptly would be "difficult, costly, and risky" and would require rapid scaling of imports from elsewhere "at higher costs," which could lead to inflation and political backlash.

In summary, India's options for buying Russian oil now involve compliance with U.S. sanctions that bar direct procurement from Rosneft and Lukoil, potentially pivoting to indirect purchases via intermediaries or alternative suppliers. 

But technical constraints, discount advantages, and geopolitical considerations mean India seeks to balance sanctions compliance with its energy security and economic interests.