New Delhi Prepares to Increase ‘Buy American’; Russian Oil Imports Likely to Fall

The Ministry of Oil and Natural Gas and state-owned energy companies are preparing to sharply increase imports from the US, The Economic Times reported, citing sources. Under the India–US trade deal announced on Monday by US President Donald Trump, he claimed that India agreed to completely stop purchasing Russian oil. This move is widely seen as implying a rollback of the 25% punitive tariff, bringing total tariffs on India down to 18%. After repeated backlash and mounting pressure over recent months, New Delhi has reduced its dependence on Russian energy and crude oil.

According to the report, senior executives at state-run refineries and gas market participants met ministry officials this week to assess how much additional crude oil and natural gas could be sourced from the US. Halting discounted Russian crude and diversifying supply from the US would likely require absorbing higher freight costs, industry experts said. Since the outbreak of the war in Ukraine, Russia has been providing India with discounted crude oil, making New Delhi one of Moscow’s largest oil buyers. The US, along with other Western allies, has alleged that India’s crude purchases were fuelling the ongoing war.

Washington has outlined its ambition to become India’s leading supplier of oil and gas, also suggesting potential Venezuelan crude supplies. However, given that it will take at least a decade for Venezuela’s energy infrastructure to be rebuilt, India is likely to rely on the US, West Asia and South America to meet its domestic oil needs.

According to the report, Indian refiners are set to sharply slash fresh orders for Russian crude, although imports will not stop entirely. “It’s a dynamic situation. For now, expect fresh Russian orders to fall, though this could change again in a few months,” The Economic Times reported, citing a source.

A key challenge arising from the shift is the global crude supply balance and price stability, the report said. Uncertainty remains over where displaced Russian crude will flow and whether China will absorb those barrels at deeper discounts. If not, and if Russian output is hit, tighter supply could push prices higher, the source said.

In January, only Indian Oil, BPCL and Rosneft-backed Nayara Energy received Russian cargoes, with volumes down 30% from the 2025 average. On gas, state-run firms have long-term contracts for 5.8 million tonnes a year with US suppliers, while also exploring another long-term US LNG deal. Other Indian refiners are also continuing to tap the US spot market when pricing allows.