23 October,2025 06:21 PM IST | New Delhi | mid-day online correspondent
Reliance Industries Ltd is India’s largest buyer of Russian crude. Representational pic
US sanctions imposed on two of Russia's largest oil companies are expected to affect Reliance Industries' direct crude imports from Russia, while public sector refiners in India are likely to continue purchasing Russian oil through intermediary traders for now, news agency PTI reported.
Industry sources said that while state-run refiners are reviewing compliance risks, they are unlikely to immediately stop Russian crude imports as they procure almost all their Russian oil from traders, primarily European, who are not targeted by the sanctions.
Reliance Industries Ltd, owned by billionaire Mukesh Ambani, is India's largest buyer of Russian crude, accounting for nearly half of the country's 1.7 million barrels per day imports from Moscow, PTI reported. The company may need to adjust its imports as it purchases crude directly from Russia's Rosneft, which has now been sanctioned, sources added.
In December 2024, Reliance signed a long-term deal with Rosneft to import up to 5 lakh barrels per day of Russian crude for 25 years. It also buys oil from intermediaries. The company has not made a statement yet on the issue.
The US Department of the Treasury's Office of Foreign Assets Control (OFAC) imposed fresh sanctions on Rosneft and Lukoil - Russia's two biggest oil firms, accused by the Trump administration of funding the Kremlin's "war machine" in Ukraine. Together, these companies export 3.1 million barrels of oil daily. Rosneft alone accounts for 6 per cent of global oil production and nearly half of Russia's output.
Since Russia's invasion of Ukraine in 2022, India has emerged as the largest buyer of discounted Russian crude following the withdrawal of many Western buyers.
Besides Reliance and Rosneft-backed Nayara Energy, public sector refiners such as Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL), Hindustan Petroleum Corporation Ltd (HPCL), Mangalore Refinery and Petrochemicals Ltd, and HPCL-Mittal Energy Ltd (HMEL) also import Russian crude.
Unlike Reliance, state-owned refiners do not have fixed-term contracts with Rosneft or Lukoil, PTI reported. They buy Russian oil through tenders where traders, mostly European or based in Dubai and Singapore, participate. These traders have not been sanctioned by the US or the European Union.
Sources noted that even if some traders avoid Russian oil volumes, Russia could quickly establish new traders with Dubai registration to continue sales to Indian and Chinese refiners.
A business insider called the sanctions "half-hearted," explaining that the Trump administration resisted stronger energy sanctions despite pressure from US lawmakers. The insider also said the market did not react strongly to the sanctions, with only a small increase in oil prices, indicating skepticism about the sanctions' effectiveness.
Nayara Energy, where Rosneft holds a 49.13 per cent stake, is another major private buyer of Russian oil. Nayara, which runs a 20 million tonnes per year refinery at Vadinar, Gujarat, has already been sanctioned by the EU and may have to adjust its purchases, sources said. Nayara did not respond to PTI's request for comments.
Kesani Enterprises Company Limited - a consortium including Mareterra and Russian Group United Capital Partners - holds the other 49.13 per cent stake in Nayara.
Sources said the Indian government has yet to instruct refiners to stop or reduce Russian crude imports.
They added that US President Trump's recent comments about India agreeing to halt all Russian oil purchases were likely linked to the EU's ban on imports of fuels refined from Russian crude, effective January 21 next year. Reliance and MRPL export refined fuels such as petrol and diesel to the EU and will have to curb Russian crude imports if they want to maintain these exports. Nayara has already stopped fuel exports to the EU following sanctions.
With three major buyers recalibrating purchases, Russian oil flows to India will likely reduce from January - a point Trump may be using to bolster his stance.
(With PTI inputs)
