Indian Refinery Halts Russian Crude Purchases Amidst US Sanctions & Trade Tensions
Indian state-backed refiner HPCL-Mittal Energy Limited (HMEL) has suspended purchases of Russian crude oil following recent sanctions imposed by the United States on Moscow‘s two largest oil companies, the firm announced Wednesday.
The decision comes as relations between Washington and New Delhi have deteriorated, notably after the US raised tariffs to 50 percent in August. US officials have accused India of indirectly supporting Russia’s war in Ukraine by purchasing its discounted oil.
US President Donald Trump has stated that Indian Prime Minister Narendra Modi allegedly agreed to reduce Russian oil imports as part of potential US trade negotiations – a claim New Delhi has not confirmed.
HMEL, a joint venture between steel tycoon Lakshmi Niwas Mittal and state-run Hindustan petroleum Corporation Ltd (HPCL), stated it “took the decision to suspend further purchases of Russian crude” after “recent announcements of new restrictions on imports of crude oil from Russia” by the United States, European Union (EU), and United Kingdom.
“HMEL’s business activity is in-line with [the] Indian government and energy security policy,” the statement added.
Reliance Industries, a major private Indian buyer of Russian crude, indicated it was evaluating the implications of the US and EU restrictions. A spokesperson stated the company “will comply with the EU’s guidelines on the import of refined products into Europe,” and with any guidelines from the Indian side. The EU’s new measures include a complete ban on Russian liquefied natural gas (LNG) imports by the end of 2026.
Reliance expressed confidence that its “time-tested, diversified crude sourcing strategy” would maintain stability in refinery operations, meeting both domestic and export demands, including to Europe.
Recent reporting by the Financial Times revealed that HMEL had received shipments of Russian crude transported by vessels subsequently blacklisted under US and EU sanctions. HMEL responded by stating it did not charter the vessels and had limited oversight of the transport chain, adding that the vessel delivering the crude to India “was not under” US sanctions at the time of delivery.
India, which imports over 85 percent of its crude oil needs, traditionally relied on suppliers from the Middle East. However, New Delhi began significantly increasing its purchases of discounted russian crude in 2022, capitalizing on Western sanctions that restricted Moscow’s export options.
