The Trump administration’s decision to ease sanctions on Russian oil sales to India to address potential supply disruptions has prompted questions about Washington’s resolve.
When President Trump and Indian Prime Minister Narendra Modi announced an interim trade agreement last month, a key element was India agreeing to stop buying Russian oil. Trump had repeatedly criticized those purchases. Yet on March 5 the US issued a 30-day waiver allowing Indian refiners to buy Russian oil again.
“India is an essential partner of the United States, and we fully anticipate that New Delhi will ramp up purchases of US oil. This stop-gap measure will alleviate pressure caused by Iran’s attempt to take global energy hostage,” US Treasury Secretary Scott Bessent said. The temporary licence covers Russian crude and petroleum products already loaded onto vessels before March 5, provided they are delivered to India and bought by an Indian company.
The policy shift responds to a surge in global oil prices after US and Israeli attacks on Iran and disruptions to shipments through the Strait of Hormuz. As the world’s third-largest crude importer, India’s ability to source oil matters for prices and supply; allowing it to import already-loading Russian cargoes aims to ease immediate pressures.
Sanctions specialist Ben Hilgenstock of the Kyiv School of Economics told DW the US is looking for quick fixes to price spikes and that “the Russian oil that is already floating around is obviously a prime candidate for that.” Bessent argued the short-term measure would not materially boost Kremlin finances because it only authorises transactions involving oil already stranded at sea.
Has this move been important for India? Before Russia’s 2022 invasion of Ukraine, India was not a major buyer of Russian oil but increased purchases when Moscow’s crude was heavily discounted. Earlier this year New Delhi agreed to curb those purchases amid pressure from Washington. At that time, global prices were lower and alternative supplies were available, making the pullback easier, Hilgenstock said.
Still, the waiver offers real relief for Indian refiners, which are vulnerable to supply shocks and price spikes. India’s crude stocks usually cover less than a month of demand, and refineries hold limited inventories of other petroleum products. Carole Nakhle, CEO of Crystol Energy, called the move “a saving grace for Indian refineries,” noting it helps buyers who had been sourcing Russian oil while they looked for alternatives.
About half of India’s crude imports transit the Strait of Hormuz, and ministers said the country was well-stocked despite short-term disruptions from the Middle East. Indian refiners and the government had been weighing emergency measures; Russia had already directed more cargoes toward Indian waters anticipating relief. Hilgenstock said the waiver is likely to lower prices and that someone would have bought the cargoes anyway, so directing them to India could benefit global prices marginally.
Had India really stopped buying Russian oil? After the US dropped tariffs in return for New Delhi pausing purchases, Indian refiners reduced Russian imports by around half from their June 2025 peak. India replaced much of that volume with Middle Eastern supplies, especially from Kuwait, Qatar, Saudi Arabia and the UAE.
Will the 30-day reprieve help Russia? Analysts say a single-month waiver, if not extended, is unlikely to make a material difference. Hilgenstock and Nakhle note other Asian buyers, including China, would probably have purchased the oil; it is now simply redirected to India. Russia’s energy revenues fell by about 20% in 2024 amid low prices and US sanctions on majors like Rosneft and Lukoil, which widened the discount on Russian crude.
Before the Iran strikes, Russian benchmark crude had traded as low as $30 a barrel, a dire situation for Moscow. While Russia might gain short-term relief from supply shocks and higher prices tied to the Middle East conflict, market fundamentals should reassert themselves once the crisis ends, especially if sanctions remain. Hilgenstock also warned that political appetite for sanctions tends to ebb when markets are under stress, noting that authorities often loosen restrictions during periods of trouble.
Edited by: Andreas Becker
