Indian Oil Refiners Stop Russian Oil Buys Because of U.S. Tariffs and Threats
NEW DELHI, India – August 1, 2025: Big Indian oil companies like Indian Oil Corporation (IOC) and Bharat Petroleum Corporation (BPCL) are no longer buying Russian crude oil on the spot market. This happened after U.S. President Donald Trump said he’s putting a 25% tariff on Indian goods and warned of extra costs if India keeps trading with Russia, especially on energy and defense. This is a big switch for India, since Russia had become their main oil source.
New Tariffs Make Getting Oil Harder
The main reason for the stop is all the extra risk and worry from the U.S. President Trump’s people said the new tariffs are because India charges high import fees on U.S. stuff and buys a lot of Russian oil. While the new tariffs are already here, the threat of an unknown extra cost for buying Russian oil has made the big state-run oil guys—including Hindustan Petroleum Corporation (HPCL) and Mangalore Refineries and Petrochemicals Ltd (MRPL)—stop getting new oil from the spot market. These four companies do over 60% of India’s oil refining.
People in the know say the oil companies are now trying to get oil from the Middle East and West Africa instead. This cuts down on political risks, but it’ll likely cost more, since Russian oil has been cheap since 2022.
What It Means for India’s Energy
Not buying Russian oil on the spot market is bad news for India, which is the world’s number three oil importer. For over a year, cheap Russian oil helped keep India’s fuel prices down and profits up for oil refiners. Switching to pricier oil will probably hurt the money that state-run oil companies make and could make gas prices go up.
Private oil companies, like Reliance Industries and Nayara Energy, have deals with Russia and will likely keep buying from them. But these companies are also facing problems from new EU rules that make it harder to ship and insure Russian oil, and some ship owners have even canceled deals.
Bigger World Impact
The U.S. tariff thing and what the Indian oil companies are doing because of it show that Western countries are putting more stress on countries that still trade a lot with Russia. President Trump also gave Russia a new deadline to make peace in Ukraine, saying he’ll put tariffs of up to 100% on anyone buying Russian oil if nothing happens.
The Indian government still doesn’t like one-sided rules but now has to try to balance what’s good for India with the money pressure from its important partners. This shows how tough it is for New Delhi to handle world politics and how it could cost them money.
