Indian buyers reassess Russian oil purchases after US-India trade agreement.
2026-02-04 14:12:06
Sources said on Tuesday (February 3) that after US President Trump announced the trade deal, Indian refiners sought clarification on their government's imports of Russian oil, with some refiners preemptively halting purchases.
US President Trump announced on Monday that a deal had been reached with India, stating that the US would lower tariffs on Indian imports in exchange for New Delhi's commitment to stop buying crude oil from Russia and instead purchase US oil and other goods and commodities.
The agreement also grants Indian energy buyers access to Venezuelan crude oil, and possibly even Iranian crude oil, as suggested by the US president, as an alternative to Russian crude oil.
India is the world's third-largest importer of crude oil. After the outbreak of the Russia-Ukraine conflict in early 2022, India significantly increased its imports of cheap Russian crude oil.
Over the past four years, India has imported a large amount of Russian crude oil, making Russia India's largest oil supplier, accounting for about one-third of India's total crude oil imports.
However, following US sanctions against Russian oil giants Rosneft and Lukoil, Indian refiners have recently reduced their purchases of Russian crude oil.
Indian refiners have stopped importing from now-sanctioned entities and turned to unsanctioned Russian supplies and alternatives from the Middle East, the Americas, and (to a lesser extent) West Africa.
India's trade agreement with the United States has restricted its imports of Russian crude oil, and supplies from Russia may decline further.
Since news of the agreement broke, at least three Indian refiners have requested guidance from Indian authorities on how to continue sourcing oil from Russia. Sources say two of these refiners have temporarily halted purchases of Russian oil.
Moody's warned that India's immediate suspension of Russian crude oil imports would severely disrupt the global oil market.
Brent crude oil daily chart source: EasyForex
At 14:11 Beijing time on February 4, Brent crude oil futures were trading at $67.76 per barrel.
US President Trump announced on Monday that a deal had been reached with India, stating that the US would lower tariffs on Indian imports in exchange for New Delhi's commitment to stop buying crude oil from Russia and instead purchase US oil and other goods and commodities.
The agreement also grants Indian energy buyers access to Venezuelan crude oil, and possibly even Iranian crude oil, as suggested by the US president, as an alternative to Russian crude oil.
India is the world's third-largest importer of crude oil. After the outbreak of the Russia-Ukraine conflict in early 2022, India significantly increased its imports of cheap Russian crude oil.
Over the past four years, India has imported a large amount of Russian crude oil, making Russia India's largest oil supplier, accounting for about one-third of India's total crude oil imports.
However, following US sanctions against Russian oil giants Rosneft and Lukoil, Indian refiners have recently reduced their purchases of Russian crude oil.
Indian refiners have stopped importing from now-sanctioned entities and turned to unsanctioned Russian supplies and alternatives from the Middle East, the Americas, and (to a lesser extent) West Africa.
India's trade agreement with the United States has restricted its imports of Russian crude oil, and supplies from Russia may decline further.
Since news of the agreement broke, at least three Indian refiners have requested guidance from Indian authorities on how to continue sourcing oil from Russia. Sources say two of these refiners have temporarily halted purchases of Russian oil.
Moody's warned that India's immediate suspension of Russian crude oil imports would severely disrupt the global oil market.
Brent crude oil daily chart source: EasyForex
At 14:11 Beijing time on February 4, Brent crude oil futures were trading at $67.76 per barrel.
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