Many Indian refiners have suspended new orders of Russian crude following U.S. sanctions on Moscow’s top exporters, Rosneft and Lukoil. The move has created uncertainty across the country’s energy sector, as companies await guidance from the government and clarification from suppliers, according to Reuters.
While some refiners are turning to the spot market for alternatives, Indian Oil Corporation (IOC) said it will continue to purchase Russian crude as long as transactions comply with sanctions. “Russian crude is not sanctioned. It is the entities and shipping lines which have got sanctions,” said Anuj Jain, Indian Oil’s finance director, during a post-earnings call.
Jain explained that the company will keep buying oil through non-sanctioned entities when price caps and shipping requirements are met. India has been the world’s largest buyer of seaborne Russian oil since the 2022 invasion of Ukraine, importing about 1.9 million barrels per day in 2025, according to the International Energy Agency (IEA).
Refineries seek alternative suppliers
After the latest round of sanctions, Indian Oil issued a tender for new supplies, while Reliance Industries increased purchases from the spot market. Mangalore Refinery and Petrochemicals Ltd. (MRPL) is also seeking up to two million barrels through a fresh tender. Meanwhile, Bharat Petroleum Corporation Ltd. (BPCL) plans to issue a December-loading cargo tender within ten days.
A BPCL source told Reuters the company will only buy Russian oil from non-sanctioned entities. “For half of our monthly supply, we hope to keep buying Russian oil through compliant channels,” the source said. “The remaining needs will be met with non-Russian crude from the spot market.”
Shift toward Middle Eastern and U.S. crude
The immediate replacements for Russian barrels include Iraq’s Basrah Heavy and Basrah Medium, as well as U.S. West Texas Intermediate (WTI) crude. However, WTI currently costs three to three-and-a-half dollars more per barrel compared to rival grades, according to refinery sources.
BPCL has already secured November supplies but is seeking additional oil for December. Other refiners have canceled cargoes linked to sanctioned traders and are waiting to see whether non-sanctioned suppliers can fill the gap.
The European Union, the United Kingdom, and the United States have imposed multiple rounds of sanctions on Russia since 2022. The most recent measures have added new pressure on India’s refining sector, forcing operators to balance energy security with compliance risks in one of the world’s fastest-growing oil markets.