Russian Crude and India: Here to Stay Amid Middle East Tensions

Commentary by Shashwat Kumar

Published March 6, 2026

For most of 2025, the Trump administration pressured India to curb Russian crude imports. It sanctioned Rosneft and Lukoil-Russia's largest oil firms-and imposed a 25 percent punitive tariff on all Indian exports to the United States. The escalating Middle East conflict-including Iran's blockade of the Strait of Hormuz and strikes on Gulf refineries-now challenge India's strategy of diversification. India's traditional Gulf oil suppliers who could have replaced Russian crude are under attack, and supplies from Venezuela remain too low to offset major disruptions. Amid uncertainty, Russian crude oil flows to India might endure, not by choice, but by necessity.

It is too early to speculate whether Russian oil exports to India will surge. Washington's March 5 waiver aids continuity, but sanctions persist. However, larger energy security concerns raise a key question: Can India afford to cut Russian reliance further from current levels (around 20-22 percent) amid turmoil in other major oil-producing regions? Pragmatism suggests it won't be an easy decision to make for Indian policymakers.

Buoyed by strong macroeconomics and ample global supply, earlier analysis suggested India could afford a phased shift away from Russian crude to circumvent U.S. sanctions. Progress has been observed in the last few months. As per Vortexa Analytics, India's share of Russian crude oil exports had continued to drop from highs of 30 percent or more to 21.4 percent (1.36 mbpd) in December 2025, and then to 19.4 percent (1.10 mbpd) in January 2026. Reliance Industries, India's largest private refinery, did not purchase any Russian crude in January 2026.

The United States took note, and in February 2026, it lifted its 25 percent punitive tariff in exchange for India phasing out Russian crude entirely. Early signs emerged of India reverting to its pre-Ukraine war import basket, where Gulf suppliers accounted for a majority of crude oil imports. As per Vortexa Analytics, by late February 2026, Iraq, Saudi Arabia, the United Arab Emirates, and Kuwait accounted for a combined 55.9 percent of India's crude imports.

This rebalancing seemed on track until now. The conflict in the Middle East threatens to upend U.S. strategy aimed at containing Russia. Efforts to starve Russia's war chest via Indian cutbacks now collide with major supply disruptions as big energy export facilities in the Gulf have come under attack. In retaliation for U.S. and Israeli strikes, Iran has targeted Gulf refineries and declared the Strait of Hormuz off-limits to foreign vessels, threatening 20 percent of global oil flows and overall global oil supply. India faces acute risks: If Gulf shipments halt, threatening more than half of India's supplies, it would spike prices and increase inflation. In fact, current prices confirm the shock-India's crude average jumped to $85.43 per barrel in early March 2026 from $69.01 per barrel in February-a 24 percent spike in just five days when crude prices were expected to remain below $70 per barrel in 2026.

In the short term, granting a month's waiver to India serves interests in New Delhi and Washington. This echoes 2022 flexibilities, enabling steady volumes without major revenue boosts to Moscow. Russia's 2022 invasion of Ukraine spiked prices, but discounted Russian crude cushioned India's economy, stabilizing prices amid volatility. Though impacts are not anywhere close to the 2022 disruption thus far, the conflict in the Middle East may drag on for an unknown period of time. The Baltic Sea, Black Sea, and Arctic routes that Russia uses to export crude oil to India can provide some chokepoint-proof reliability, holding volumes steady despite sanctions.

For India, diversification remains key. The conflict increases the chances of greater reliance on Russian crude, and perhaps bring gas into the mix. This combination may elevate Moscow to a Gulf-tier supplier of energy for India once again. Import shares from Gulf countries may rebound post-crisis, as OPEC+ has agreed to slightly increase oil output. Yet pragmatism rules: With the U.S. waiver in hand, ongoing extensions amid geopolitical uncertainties should not be ruled out. Russian crude flows to India may endure less by desire than by demand.

Shashwat Kumar is a fellow with the Chair on India and Emerging Asia Economics at the Center for Strategic and International Studies in Washington, D.C.

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