India to keep buying Russian oil despite Trump's penalty threat: Report

Business Standard

5 hours ago

India will continue to buy crude oil from Russia, despite US President Donald Trump's warning of a penalty, according to a report in Reuters, quoting two Indian government sources, who did not wish to be identified due to the sensitivity of the matter.
"These are long-term oil contracts," one of the sources said. "It is not so simple to just stop buying overnight."
The New York Times, in its report, quoted two unnamed senior Indian officials as saying there had been no change in Indian government policy. One of the officials, in the news report, said the government had "not given any direction to oil companies" to cut back imports from Russia.
The Indian authorities had, on Friday, said their energy decisions are based on national interest and market factors.
Trump recently claimed India may stop purchasing oil from Russia, calling it a 'good step' if true. However, India's foreign ministry stated on Friday that no such decision has been made.
Speaking to the media on Friday, Trump said, 'I understand that India is no longer going to be buying oil from Russia. That's what I heard — I don't know if that's right or not — but that would be a good step.' His comment followed the US government's announcement of a 25 per cent tariff on all goods imported from India, effective from August 1, along with an unspecified penalty.
Tougher stance: 100% tariff warning
In mid-July, Trump issued a stronger threat, warning of up to 100 per cent tariffs on any country that continues to buy oil from Russia unless there is a complete peace agreement between Russia and Ukraine.
Earlier this week, he also criticised India's economic partnership with Russia. Posting on Truth Social, Trump said, 'I don't care what India does with Russia. They can take their dead economies down together, for all I care.' He repeated long-standing complaints about India's high tariffs, saying, 'Their tariffs are too high, among the highest in the world. The US has done very little business with India for this reason.'
On Wednesday, the US officially announced a 25 per cent tariff on all Indian exports to the United States starting August 7.
India defends its position
Responding to the US statements, India's Ministry of External Affairs said the country decides on oil purchases based on availability, global prices, and domestic needs. 'We look at what is there available in the markets, what is there on offer, and also what is the prevailing global situation,' said foreign ministry spokesperson Randhir Jaiswal during a press briefing on Friday.
Russia remains India's top oil supplier
Russia continues to be India's leading crude oil supplier, accounting for about 35 per cent of total oil imports. From January to June 2025, India imported around 1.75 million barrels per day of Russian oil — slightly higher than the same period last year, Reuters reported.
Other key suppliers include Iraq, Saudi Arabia, and the UAE. India is the world's third-largest importer and consumer of oil.
US Senator Marco Rubio calls India's Russia ties a concern
US Secretary of State Marco Rubio also expressed concern over India's oil purchases from Russia, saying it is 'most certainly a point of irritation' in the US-India relationship. Speaking to Fox Radio on Thursday, Rubio noted that even among allies, it is normal to disagree on some foreign policy matters.
'India is a strategic partner. Like anything in foreign policy, you're not going to align 100 per cent of the time,' he said.
(With agency inputs)