U.S. President Donald Trump and Indian Prime Minister Narendra Modi arrive for a joint press conference in the East Room of the White House in Washington, DC, on February 13, 2025.
Jim Watson | AFP | Getty Images
Analysts say India is likely to continue buying Russian crude oil as a U.S. Supreme Court ruling that outlaws President Donald Trump’s import tariffs limits his trade policy options.
“We hope that India maintains a healthy relationship with Russia, including on energy issues,” Saran Sidor, director of the Global South Program at the Quincy Institute for Responsible State Strategy, told CNBC’s Inside India. He added that India may reduce its oil purchases from Russia but is unlikely to stop them completely.
India has imported 1.16 million barrels per day (mbd) of Russian crude so far in February, lower than the 2025 average of 1.71 million barrels per day, according to energy data provider Kpler.
Although it is too early to draw data on arrivals for March and April, Muyu Shu, senior crude oil research analyst at Kpler, said: “The market buzz indicates that Indian refiners are holding back on booking Russian crude for April delivery this month following the US-India Interim Trade Agreement reached earlier this month.”
However, following Friday’s US Supreme Court ruling that President Trump did not have the legal authority to impose significant import tariffs under the International Emergency Economic Powers Act (IEEPA), Xu said India had room to maintain its oil imports from Russia by 800,000 to 1 million barrels per day.
Mr. Sidle said the court’s ruling would limit President Trump’s ability to modify tariffs for reasons such as purchases of Russian oil or factors unrelated to trade or the economy.
India’s Ministry of Oil and Natural Gas did not respond to CNBC’s request for comment.
troublesome problem
India’s purchase of Russian oil is a thorny issue that soured relations between the United States and India last year.
In August, President Trump imposed 25% tariffs on Indian goods to punish New Delhi for purchasing Russian crude oil, accusing India of “fueling the[Russian]war machine” against Ukraine. This means that India’s exports to the US will now be subject to a total of 50% tariffs, the highest of any US trading partner, in addition to the 25% reciprocal tariffs that the US had already imposed on Indian goods.
Following the interim trade agreement, the US reduced tariffs on Indian goods from 50% to 18%.
In an executive order on February 6, US President Donald Trump lifted a 25% punitive tariff on India and said New Delhi “commits to suspend direct or indirect imports of Russian Federation oil” and purchase “energy products from the United States.”
However, the joint statement issued by India and the United States announcing the interim trade agreement omitted any mention of India’s pledge to curb its purchases of Russian crude oil. But the statement included New Delhi’s intention to buy $5 trillion worth of American goods, including energy, over the next five years as part of the deal.
Alexandra Harman, chief economist at Oxford Economics, said India’s promise to cut its purchases of Russian oil “was never formally codified and always seemed difficult to implement in practice.”
Hellman added that India’s energy strategy is fundamentally driven by price considerations and the motive of not being tied to a particular supplier. “It is unlikely that U.S. oil will replace Russian barrels in any meaningful way,” Herrmann said.
Last Friday, hours after the U.S. Supreme Court’s ruling on IEEPA tariffs, President Trump invoked Section 122 of the Trade Act of 1974, initially imposing a 10% import tariff worldwide. He later raised that rate to 15%. But the tax rate was 10%, according to a U.S. Customs and Border Protection memo released Monday night when the levy went into effect.
Indian trade negotiators have rescheduled a trip to Washington to finalize a tentative trade deal. Officials told CNBC’s Amitoy Singh that the visit “will be scheduled after both sides have had time to assess the latest developments and their impact.”
“India continues to import Russian crude oil despite several tariff strategies,” said Pankaj Srivastava, senior vice president of commodity markets at Rystad Energy.
Analysts said the US court’s ruling against President Trump’s tariffs and the subsequent imposition of a 10% global tariff would reduce the benefits that India’s exporters to the US would gain from the trade deal.
In light of recent developments, Srivastava said the US does not intend to press India too hard on the issue of cutting Russian oil purchases or jeopardize the US’s “substantial” energy exports to India.
Kupler said India regularly buys between 200,000 and 300,000 barrels of U.S. crude oil per day. As of the end of January, Russia was India’s biggest oil supplier, with the US in sixth place, according to data from Kpler and Rystad Energy.
