Oil & Gas

India’s rise as the top buyer of Russian seaborne crude since Moscow’s 2022 invasion of Ukraine has been a windfall for its refining industry. Private refiners such as Reliance Industries and Nayara Energy have been sourcing discounted Russian oil, processing it, and selling refined fuels like diesel and gasoline to global markets  often to destinations outside direct sanctions. However, with U.S. President Donald Trump warning of potential tariff hikes on countries purchasing Russian crude, and the EU set to ban imports of fuels derived from Russian oil starting January 21, the pressure on New Delhi’s energy trade is intensifying. State refiners in India have already scaled back Russian purchases, but private players remain deeply involved, making them a focal point for international scrutiny.

From a business perspective, Reliance and Nayara’s operations remain vital to global fuel supply chains. Reliance, operator of the world’s largest refining complex in Jamnagar, exported over 21.6 million tons of refined products in the first half of 2025, supplying major buyers like BP, ExxonMobil, Glencore, Vitol, and Trafigura. Nayara, majority-owned by Russian oil major Rosneft, shipped nearly 3 million tons about 30% of its total output despite EU sanctions forcing production cuts and logistical challenges. These exports are not only significant for the companies’ bottom lines but also for India’s trade balance, as fuel sales form a key part of its export revenue.

Economically and geopolitically, the stakes are high. India’s continued trade in Russian-linked oil products provides Moscow with an indirect outlet for its energy exports, undermining Western sanctions aimed at curtailing Kremlin revenues. At the same time, the U.S. sees the trade as a challenge to its broader strategy of reshaping global oil flows away from Russia. For India, the challenge lies in maintaining its energy security and export earnings while avoiding retaliatory measures that could disrupt markets and damage diplomatic relations. The coming months will test New Delhi’s ability to navigate between economic pragmatism and growing geopolitical headwinds from Washington and Brussels.