India is set to benefit from an increased discount on Russian crude, which has risen to $3–4 per barrel–up from $2.5, and just $1 in July, according to Zee Business research.
Crude for September–October is expected to be even cheaper, offering significant cost advantages to Indian refiners.
The move comes as India strengthens its position as the third-largest oil buyer globally, with imports from Russia surging from 1 per cent to 40 per cent in just three years. Currently, India imports more oil from Russia than from Iraq, Iran, UAE, or the US, with FY24-25 imports averaging 5.4 million barrels per day.
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ONGC welcomes cheaper oil
ONGC has indicated that if prices remain low, imports will continue without restrictions. Chairman and CEO Arun Kumar Singh said that any change in policy would depend on government directives, signaling a cautious but open approach.
Cheaper Russian oil benefits public sector refiners by offering higher refining margins, a stable supply, and better pricing power over private players, while also mitigating risks from Middle East supply disruptions.
Trump’s heat on India over Russian oil
The US President Donald Trump’s administration last week doubled tariffs on Indian exports to 50 per cent, targeting India for its Russian oil imports amid the Ukraine war. The move came after years of criticism, despite Washington previously encouraging such purchases at the war’s outset in 2022.
White House trade adviser Peter Navarro even called the Russia-Ukraine conflict “Modi’s war,” accusing India of profiteering by refining and re-exporting Russian crude, calling it the Kremlin’s “laundromat.”
Also Read: Energy of 1.4 billion not up for trade: India stands firm on Russian oil imports despite Trump’s tariff shock
India pushes back, strengthens ties with Russia, China
India rejected these charges, with External Affairs Minister S Jaishankar noting that its oil trade with Russia stabilises global prices and is a national and international necessity. Union Oil Minister Hardeep Singh Puri affirmed that all transactions with Moscow are transparent and legitimate.
In a show of strategic alignment, Prime Minister Narendra Modi highlighted India’s “special” relationship with Russia and endorsed Chinese President Xi Jinping’s call to rebuild ties as partners rather than rivals during the Shanghai Cooperation Organisation summit.
