NEW DELHI: Russian oil prices are dropping further for Indian buyers, with discounts widening to $3-4 per barrel. This comes as the Trump administration hits India with a 50% tariff over its growing Russian oil purchases amid tensions between Washington and New Delhi. The US has accused India of helping fund Russia’s war in Ukraine through these oil deals.
Discounts on Russian Urals grow wider
According to a Bloomberg report, Russia’s Urals crude is now being offered at discounts of $3 to $4 a barrel to Brent, for shipments loading in late September and October.Just last week, the discount was about $2.50, compared with $1 in July. By contrast, US crude recently bought by Indian refiners came at a $3 premium to Brent, making Russian oil the cheaper option.
Trump adviser justifies pressure on India
Defending the steep tariffs, Trump adviser Peter Navarro said: “Before Putin invaded Ukraine, India didn’t buy Russian oil to speak of—very, very small amounts. What happened? Now, Russian refiners provide discounts, India refines it, and then sells it at a premium to Europe, Africa, and Asia. It fuels the Russian war machine.”
India: Top buyer of Russian oil
India, the world’s third-largest oil importer, has sharply raised Russian crude purchases since 2022, going from under 1% of imports to nearly 40%.Currently, Russia accounts for 36% of India’s 5.4 million barrels per day of imports in 2024–25, surpassing Iraq, Saudi Arabia, the UAE, and the US.New Delhi insists its oil trade with Moscow does not violate any international laws, noting that no sanctions prohibit crude purchases. While the EU recently banned refined fuel made from Russian oil, the US has not imposed such restrictions.Although media reports often claim India saved between $10 billion and $25 billion from discounted Russian crude, brokerage CLSA estimates the real benefit is far lower.Its report said: “Benefit from Russian oil imports is way less than exaggerated media numbers.” CLSA calculated India’s annual savings at just $2.5 billion, about 0.6% of GDP.
Trade talks hit a roadblock
India’s Russian oil imports have become a flashpoint in trade talks with Washington. Alongside the 50% tariff, the US has slapped an additional 25% duty on Indian goods. But Indian refinery executives suggest Russian crude procurement will continue, with New Delhi showing little sign of bowing to US pressure.
