New Delhi: India’s major oil refiners have temporarily halted new orders for Russian crude as they await government guidance and assess the impact of fresh U.S. sanctions targeting Moscow’s key energy producers.
According to industry sources, companies such as Indian Oil Corporation (IOC) and Reliance Industries have paused fresh procurement from Russian suppliers after Washington imposed sanctions on Rosneft and Lukoil earlier this month. The refiners are seeking clarity from authorities and banks on whether payments linked to these companies could violate global trade restrictions.
For the past two years, discounted Russian oil had become a major component of India’s energy imports, accounting for nearly 40 percent of the country’s crude intake. However, recent sanctions and tightening financial rules have made transactions more complicated. Several banks have reportedly become cautious about processing payments involving Russian-linked traders or vessels, forcing refiners to reconsider their sourcing strategies.
Industry officials say the refiners are closely monitoring the situation before committing to new deals. “There is uncertainty around how the sanctions will be implemented, especially regarding payments and shipping. Everyone is waiting for more clarity,” one official said.
Both Indian Oil Corporation and Reliance Industries have stated that they will comply with all applicable international regulations. Reliance has already stopped importing from Rosneft, while IOC confirmed it will follow all sanctions-related guidelines.
The shift could reshape India’s energy landscape. With Russian crude facing barriers, refiners are turning toward alternative sources in the Middle East, the United States, and Africa. Analysts estimate that substituting Russian oil may slightly raise India’s import costs, but the increase is expected to remain manageable.
The U.S. Treasury has given companies until November 21 to wind down transactions involving the sanctioned Russian firms, prompting Indian refiners to cancel or delay some cargoes booked through intermediaries.
For India, the developments come at a delicate time. New Delhi has long balanced its relationships with both Washington and Moscow, emphasizing energy security as a national priority. The outcome of this pause will depend on how quickly the government provides official direction and how refiners adjust their contracts to comply with the evolving global rules.
Energy experts believe that if the sanctions remain strict, India may need to further diversify its crude suppliers, potentially altering trade flows and refining margins. For now, the country’s refiners are in a holding pattern waiting for clarity before resuming one of their most crucial import relationships.