Late last month, US President Donald Trump announced a 25 percent tariff on Indian exports to the United States, along with an unspecified penalty for purchasing oil and arms from Russia.Russian oil makes up 35-40 per cent of the country's crude intake, helping reduce overall energy import costs, keep retail fuel prices in check, and contain inflation.Narendra Taneja, Energy expert, says Russia exports 5 million barrels of oil every day to the global oil supply system and if Russian oil is forced out of this system, fuel prices would shoot up. "For us in India, if the prices go up in America, it will have an impact on many other things, including our economy and the global economy at large. But as far as our oil supplies for domestic consumption are concerned, we don't need to worry about it. We import crude oil from 40 different countries including America, Middle East, Africa, Latin America, South East Asia, Brunei and many other countries. We are not worried about there being a disruption of supply to India," Taneja told PTI Videos. According to analysts, India's annual oil import bill could rise by 9 to 11 billion dollars if the country is forced to slash its purchases of Russian crude. This would impact major Indian crude refiners, as they would be forced to buy more expensive oil from the Middle East or other places, affecting their profit margins, while also raising the spectre of inflation for Indian consumers."It's up to the companies – the government companies or the private companies to get oil from wherever they can. Indian companies have been importing oil from Russia for no love of Russia. They have been importing oil from Russia, because Russia has been offering a good discount. This is all about the economics of oil. It's not the government which tells the companies to import from Russia. These decisions are taken by different companies, whether government sector companies or private sector companies. They take the call," he said. Switching suppliers of crude will also involve complex logistical, economic and geopolitical considerations. Discounted Russian crude also enabled India to refine the oil and export petroleum products, including to countries that have banned direct imports from Russia. This helped Indian oil companies post record profits.
00:00Last week, US President Donald Trump announced a 25% tariff on Indian exports to the United States,
00:10along with an unspecified penalty for purchasing oil and arms from Russia.
00:16Russian oil, which accounted for less than 0.2% of India's imports before the Ukraine war,
00:22now makes up to 35-40% of the country's crude intake, helping reduce overall energy import costs,
00:30keep retail fuel prices in check and contain inflation.
00:36Russia exports 5 million barrels of oil every day into the global oil supply system.
00:44So if Russian oil is forced out of the global oil system, the result would be the prices will go up.
00:50So for us in India, the biggest worry is the prices may go up if America persists with this kind of policy.
00:58Our second worry is that if prices go up, the impact it will have on many other things,
01:07including our economy and the global economy and so on and so forth.
01:11But as far as the oil is concerned, the supply is concerned, our oil supplies are concerned for domestic consumption,
01:17we don't need to worry about it in the sense that, you know, we import crude oil for 40 different countries around the world,
01:23including America, Russia and Middle Eastern countries, Africa, that in America, Southeast Asia, Brunei and so many other places.
01:31So if we are not worried about this thing, there will be a disruption in terms of supply of oil to India.
01:37According to analysts, India's annual oil import bill could rise by 9 to 11 billion dollars
01:45if the country is forced to slash its purchases of Russian crude.
01:50This would impact major Indian crude refiners as they would be forced to buy more expensive oil from the Middle East
01:57or other places, affecting their profit margins, while also raising the specter of inflation for Indian consumers.
02:04It's up to the companies, whether the government of India company or the private companies, to oil from wherever they can.
02:12And Indian companies have been importing oil from Russia for no love of Russia.
02:16They have been importing oil from Russia because Russia has been offering good discount.
02:20It's all about economics of oil.
02:23So therefore, and it's not the government which tells these companies go and import from Russia.
02:27These diseases are taken by different companies, whether public sector company or private sector company.
02:33They take the call.
02:34Switching suppliers of crude will also involve complex logistical, economic and geopolitical considerations.
02:43Discounted Russian crude also enabled India to refine the oil and export petroleum products,
02:49including to countries that have banned direct imports from Russia.
02:53This helped Indian oil companies post record profits.
02:57This is now under threat, not just because of the proposed US penalty, but also because the European Union recently announced a ban on imports of refined products derived from Russian origin crude.
03:09The EU sanctions are supposed to come into effect from January 2026, which may also force Indian refiners to end their reliance on Russian crude.
03:21The US tariff threat, on the other hand, raises the possibility of secondary sanctions that would directly impact the shipping, insurance and financing network supporting India's Russian oil trade.
