India Scales Back Russian Crude Amid Tariff Risks

The cooling trend appears set to continue, with Kpler data projecting September imports at 1.9 million barrels per day. This decline, however, is not a direct reaction to the newly signed Lindsey O. Graham Sanctioning Russia and Iran Act. Instead, Indian refiners are recalibrating their procurement strategies as Middle Eastern supply routes stabilize. Notably, Iraqi crude imports surged 25% in August, while Saudi shipments saw a modest rise of 1.5%.

Financial pressures are complicating the logistical pivot. India’s crude import bill climbed 48.4% to $74.8 billion between April and August, despite import volumes remaining largely flat. Rising freight costs and global price volatility have eroded the savings previously gained from discounted Russian barrels. The calculus for Indian refiners now hinges on whether the discount on Russian oil justifies the risk of potential U.S. tariffs on broader Indian exports.