India’s Russian Oil Imports to Fall Sharply in December as Sanctions Tighten

Contents

Sanctions Deadline Forces Refiners to Cut Purchases EU’s January Deadline Adds More Pressure Most Indian Refiners Halt Russian Buys Geopolitical Pressures Influence India’s Crude Choices What Lies Ahead for India’s Russian Oil Imports?

India’s heavy reliance on discounted Russian crude is set to decline sharply next month, with India’s Russian oil imports expected to hit their lowest level in at least three years. The drop comes as Indian refiners scale back purchases to avoid triggering stricter Western sanctions targeting Russia’s largest oil producers.

According to multiple trade and refining sources, the shift marks one of the most significant adjustments in India’s crude sourcing strategy since Moscow became New Delhi’s top supplier following the Ukraine conflict. The United States, the European Union and the United Kingdom have all intensified restrictions on Russian energy flows, compelling Indian companies to reevaluate their procurement models.

This month, India is expected to receive 1.87 million barrels per day (bpd) of Russian crude, provisional data from analytics firm Kpler shows. But by December, that number may drop dramatically to nearly one-third of current volumes.

Sanctions Deadline Forces Refiners to Cut Purchases

The latest US sanctions—targeting Russian oil giants Rosneft and Lukoil—have put Indian refiners on high alert. Buyers were given until November 21 to wind down dealings with the sanctioned firms, forcing state-run refiners to either pause or heavily limit their purchases.

A senior refining source said that heightened bank scrutiny has made state refiners “extremely cautious,” as financial institutions are now closely monitoring transactions linked to Russian entities. As a result, India is likely to receive 600,000 to 650,000 bpd of Russian crude in December—marking the sharpest single-month decline in years.

In October, India imported 1.65 million bpd, about 2% higher than September. But the elevated November volumes are being attributed to a rush to stock up ahead of the sanctions deadline, rather than sustained demand.

A trade source noted, “Russian supply is expected to be high in November as many refineries tried to fill the stocks prior to the US deadline. This was also driven by upcoming EU rules requiring oil products for the European market to be produced from non-Russian crude starting 2026.”

Also Read : Despite Snapping a 5-Day Slide, Smallcaps Are Still Expected to Underperform — 4 Factors Why

EU’s January Deadline Adds More Pressure

Adding to the complexity, the European Union has set January 21 as a deadline after which it will no longer accept fuel produced at refineries that processed Russian crude within 60 days of the bill of lading.

This measure is expected to have indirect implications on Indian fuel exports, especially diesel and jet fuel, both of which are key components of India’s refined product shipments to Europe. As a result, refiners are adjusting their procurement mix to avoid any future compliance issues.

Most Indian Refiners Halt Russian Buys

Several major Indian refiners have already suspended Russian crude purchases to avoid running afoul of sanctions:

Mangalore Refinery and Petrochemicals Ltd (MRPL)
Hindustan Petroleum Corp (HPCL)
HPCL-Mittal Energy Ltd

State-run oil majors Indian Oil Corp (IOC) and Bharat Petroleum Corp (BPCL) have stated they will now source Russian crude only from non-sanctioned entities.

Meanwhile, Nayara Energy—partly owned by Rosneft—remains the outlier, continuing to process Russian crude exclusively after alternative suppliers withdrew due to British and EU restrictions.

The changing supply dynamics have also altered trade flows. The share of US oil in India’s crude basket surged in October to its highest level since June 2024, as refiners tapped an attractive arbitrage opportunity.

Geopolitical Pressures Influence India’s Crude Choices

India has been facing growing diplomatic pressure from Washington, which recently doubled tariffs on certain Indian imports to 50%, citing New Delhi’s continued appetite for Russian crude as one of the factors behind the decision.

Analysts say the geopolitical tug-of-war is likely to influence India’s crude strategy in the coming months, as policymakers seek to balance energy security, cost competitiveness and diplomatic relationships.

What Lies Ahead for India’s Russian Oil Imports?

While December is expected to mark a significant drop in India’s Russian oil imports, industry experts believe the trend may remain volatile depending on the evolution of sanctions, global oil prices and shipping logistics.

Refiners are expected to diversify further into Middle Eastern and US grades to avoid supply disruptions, but the transition could increase India’s overall crude import bill, given that Russian crude has been available at steep discounts since 2022.

Still, market participants say India will continue to buy Russian barrels from non-sanctioned intermediaries as long as the economics remain favourable and compliance risks manageable.

For now, refiners are prioritising caution as they navigate the most restrictive sanctions regime since the war began—bringing an abrupt end to India’s record-high Russian oil binge that has lasted nearly two years.