Indian Refiners Halt Russian Oil Purchases Amid US Sanctions Uncertainty

Following new U.S. sanctions targeting Russia's major oil producers Rosneft and Lukoil, India's state-run and major oil refiners, including Indian Oil Corporation, Bharat Petroleum, Hindustan Petroleum, and Reliance Industries, have temporarily halted new purchases of Russian crude oil as they seek clarity on legal and banking compliance issues. The sanctions, which blacklist key Russian oil suppliers, have disrupted over 80% of India's Russian oil imports, prompting companies to explore alternative procurement through smaller, non-sanctioned Russian entities and to consider shifting supplies toward the Middle East and the U.S. Despite Russian oil itself not being directly sanctioned, concerns over secondary sanctions and payment mechanisms have led to a cautious pause on new contracts. This development marks a strategic balancing act for India, as it navigates its longstanding energy ties with Russia while managing economic relations with the U.S., which has pressured India to reduce Russian oil imports through tariffs and diplomatic means. The pause in Russian oil purchases and potential supply chain shifts could significantly alter India's energy sourcing and impact global energy markets. Refiners await official government guidance and banking assurances before resuming transactions, with the coming weeks critical for decisions on future oil import strategies.