WITH AN effective halt in cargo movement through the Strait of Hormuz hitting crude oil flow to India, the US has issued a temporary 30-day “waiver” to allow Indian refiners to buy Russian crude that is already in the high seas.
India had, in recent months, cut down significantly on its oil imports from Russia amid trade negotiations with the US, as Washington made it a pre-requisite for scrapping its 25% additional penal tariff on New Delhi. But with the Strait of Hormuz—through which India gets over 40% of its oil imports—effectively closed, refiners had already started buying more Russian oil already available in the high seas, as per trade sources and vessel tracking data.
The move will provide short-term relief to India, which imports 88% of its oil needs, said experts. However, this alone may not be able to fully offset the country’s exposure to West Asian oil that came through the critical chokepoint of the Strait of Hormuz. Experts also see it as part of US President Donald Trump’s effort to prevent a rise in domestic fuel prices in the US given the midterm elections later this year.
President Trump’s energy agenda has resulted in oil and gas production reaching the highest levels ever recorded.
To enable oil to keep flowing into the global market, the Treasury Department is issuing a temporary 30-day waiver to allow Indian refiners to purchase Russian oil.…
— Treasury Secretary Scott Bessent (@SecScottBessent) March 6, 2026
Around 130 million barrels of crude is estimated to be on ships on water as of early March. These include significant volumes across the Indian Ocean, Red Sea and Suez Canal routes, and around Singapore, which could potentially be redirected towards Indian ports, as per data from commodity market analytics firm Kpler.
A senior government official said that India never stopped buying Russian crude, and this waiver appears to be more for Washington’s own legal and procedural requirements considering the Trump administration had imposed sanctions on various suppliers and tankers involved in Russian oil trade, and had also issued executive orders pertaining to penal tariffs against India. “The fact is that we were anyway buying…we make our own decisions on where to buy from, and we buy from diverse sources. Our commitment is to our consumer…This waiver is for their (US) own legal purposes,” said the official, who did not wish to be identified.
The official also said India has been a large buyer of American energy is willing to buy more.
There were already some signs that India was increasing its intake of Russian crude by tapping cargoes already on water. The Indian Express had reported on Thursday that two crude oil tankers laden with Russian oil, which were earlier showing East Asia as their destination, arrived at Indian ports. Another tanker, while still showing Singapore as its destination, seemed to be heading towards India’s west coast instead. On Wednesday, Russian Deputy Prime Minister Alexander Novak said that Moscow was ready to satisfy additional demand for oil from India and China, if the need arises. “Always ready,” Novak said in response to a question as to whether Russia plans to increase oil supplies to India and China amid the escalation of the conflict in West Asia, Russian news agency Interfax reported.
Announcing the exception, US Treasury Secretary Scott Bessent posted on social media platform X, “President Trump’s energy agenda has resulted in oil and gas production reaching the highest levels ever recorded. To enable oil to keep flowing into the global market, the Treasury Department is issuing a temporary 30-day waiver to allow Indian refiners to purchase Russian oil. This deliberately short-term measure will not provide significant financial benefit to the Russian government as it only authorizes transactions involving oil already stranded at sea. India is an essential partner of the United States, and we fully anticipate that New Delhi will ramp up purchases of U.S. oil. This stop-gap measure will alleviate pressure caused by Iran’s attempt to take global energy hostage.”
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In February, India imported just over 1 million barrels per day (bpd) of Russian crude, almost half of the 2025 peak of over 2 million bpd, as per tanker data. Loadings of Russian crude for Indian ports, which averaged 1.7 million bpd last year, was just 0.7 million bpd in February. Early February, the US and India announced that they had concluded an interim trade agreement under which the 25% additional tariff imposed on India for buying Russian oil was scrapped, and the baseline tariff was reduced to 18% from 25%. The US had claimed that India had committed to halt oil imports from Russia. New Delhi didn’t comment on this claim by Washington, even as there was a visible reduction in its oil imports from Moscow.
Around 2.5–2.7 million barrels per day (bpd) of India’s crude imports—accounting for around half of the country’s total oil imports—have transited the Strait of Hormuz in recent months. This oil is mainly from Iraq, Saudi Arabia, the UAE, and Kuwait. The Strait of Hormuz, connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea, is seen as the most important oil transit chokepoint globally, handling approximately one-fifth of global liquid petroleum consumption and global LNG trade.
The government and oil companies are in touch with all international suppliers, including national oil companies and even large traders like Vitol, Trafigura, and ADNOC Trading, to source additional volumes of crude oil from their international portfolios in view of the West Asia conflict, even as the country is in a “comfortable” position to prevent any near-term supply shortage when it comes to major fuels like petrol and diesel.
As for Russian oil, trade sources said that over 15 million barrels of Russian oil are in waters close to India, primarily in the Arabian Sea, the Bay of Bengal, and the Indian Ocean. Another around 7 million barrels of Russian crude is estimated to be in tankers positioned around Singapore. These cargoes can reach Indian ports within a week or so. Then there are more volumes floating in other geographies.
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“With the (US) waiver now in place, refiners could quickly resume purchases, potentially pushing Russian inflows around 1.6-2 million bpd in the near term. While this provides a short-term logistical buffer, it cannot fully offset India’s around 2.6 million bpd exposure to Middle Eastern crude, and competition from Chinese buyers for the same Russian barrels will limit the upside,” said Sumit Ritolia, Lead Research Analyst, Refining & Modeling at Kpler.
Trade sources indicated that the war in West Asia has already led to Russian oil being sold at a premium, instead of a discount, which was the case till last month. Indian refiners are, however, expected to ramp up purchases to secure energy supplies.
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