Fresh U.S. sanctions on Rosneft PJSC and Lukoil PJSC, Russia’s top crude suppliers, are expected to push Indian refiners toward costlier imports from West Asia and other regions, analysts said. The two sanctioned firms account for nearly 60% of India’s Russian oil purchases. “India can substitute these volumes from the Middle East or elsewhere, but the import bill will rise,” said Prashant Vasisht of Icra Ltd.
Russia has been India’s largest oil supplier since FY23, covering about 35% of total imports. The U.S. Treasury has set 21 November as the deadline to halt transactions with the sanctioned companies, affecting roughly 1 million barrels per day (bpd) of Russian crude supplied to India. Industry officials said Russian flows to Indian refiners may drop to near zero following the sanctions.
According to Yes Securities, refiners will likely turn to spot markets to bridge the gap, but they will lose the $2–4 per barrel discounts previously offered by Russia. Experts noted that while supply will remain steady, costs will climb since West Asian and U.S. suppliers rarely offer discounts. India, which now sources oil from about 40 countries, may see traditional exporters compete to regain market share, creating new trade dynamics.