Cautious Indian refiners wait on Russian oil amid US tariff uncertainty

New Delhi: Some Indian refiners are taking a cautious approach to Russian oil tenders, delaying orders for September-loading cargoes as they wait for clarity on how Trump's proposed 25% oil purchase-linked penalty will play out. Executives at these refiners however said a hasty shift to alternative suppliers would tighten the market and risk pushing global oil prices higher.

"We haven't awarded any tender for Russian oil for September loading as yet," said a refinery executive, adding that the company may do so in the coming days.

Indian refiners tend to place orders a month before loading, and it typically takes another month for tankers to reach Indian ports.


Like most governments and businesses worldwide, refinery executives were closely monitoring the Alaska meeting between US President Donald Trump and Russian President Vladimir Putin, whose outcome brought little clarity to the uncertainties surrounding Moscow's oil trade.

Ahead of the Alaska meet, Trump seemed to soften his stance while remaining ambivalent on imposing secondary sanctions on buyers of Russian oil. "If I have to do it, I'll do it. Maybe I won't have to do it," he said.

Some Indian refinery executives remain hopeful that the US will defer the 25% penalty, while others are worried that if Trump were to impose secondary sanctions-different from the penalty-it would seriously disrupt India-Russia oil trade.

Indian Oil chairman A S Sahney said on Thursday that the government has not yet issued any directions to refiners on Russian oil purchases. Other refinery executives echoed Sahney's view, saying refiners were relying on their own market judgment.

India imported an average of 1.7 million barrels per day of crude oil from Russia in 2025, according to energy cargo tracker Vortexa. That accounts for about 35% of India's total crude requirements. "It will not be easy to substitute so much of Russian supplies quickly," an industry executive said. "If so much supplies evaporate from the market, there will be tension. Prices will rise," he added.

The global oil market is currently oversupplied, weighing on prices, which have averaged $66 per barrel this month. "The sudden switch by India can tighten the market," a second executive said. "Those volumes will ultimately find buyers, but global trade rebalancing may take 2-3 months, during which there will be an impact on prices."

Only a few countries have an appetite as large as India's, meaning Russian volumes would need to be redistributed among many buyers, including existing ones such as China and the EU.