The Tamesis
Indian refiners are reportedly shying away from buying Russian oil as New Delhi struggles to reach a long-delayed tariff deal with Washington despite growing protests against the deal.
India and the United States moved closer to a trade deal on Friday, declare a frame They hope to reach a deal in March to lower tariffs and deepen economic cooperation.
The two governments said in a joint statement that the framework reaffirmed their commitment to negotiate a broader bilateral trade agreement, while noting that further negotiations would be needed to complete the agreement.
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Separately, US President Donald Trump on Friday canceled an additional 25% tariff on Indian goods buying Russian oil in an executive order as New Delhi “commits to stop direct or indirect imports” of Russian oil.
Officials, however, said they would closely monitor and recommend the reinstatement of tariffs if India resumes oil purchases from Russia.
Amid these developments, India’s three largest refiners Indian Oil Corp, Bharat Petroleum Corp and Reliance Industries Ltd are not accepting offers from traders for loading Russian oil in March and April, a trader with contact with refiners told Reuters.
However, refining sources said the refineries had planned to deliver some Russian oil in March. Most other refiners have stopped buying Russian crude.
Sources said Indian refiners may change their plans and place orders for Russian oil only with government advice.
Ensure energy security
Meanwhile, New Delhi has not yet announced plans to halt Russian oil imports, despite pressure from Washington.
India becomes the largest buyer The price of Russian seaborne crude oil fell sharply after Russia invaded Ukraine in 2022, triggering a backlash from Western countries, which had targeted Russia’s energy sector with sanctions aimed at cutting Moscow’s revenue and making it more difficult to fund the war.
One regular buyer in India is Russian-backed private refiner Nayara, which produces 400,000 barrels of oil per day at its refinery and relies entirely on Russian oil. Sources said Nayara may be allowed to continue buying Russian oil as other crude sellers pull back following EU sanctions on the refinery in July.
As Indian officials have repeatedly insisted, this is in line with New Delhi’s larger policy of sourcing oil based on the energy needs of the world’s most populous country.
Indian Foreign Secretary Vikram Misri also reiterated this stance on Monday. Misri said India plans to maintain multiple sources of energy supply and diversify where needed as New Delhi wants to ensure consumers have “adequate energy at the right price through reliable and secure supply”.
However, sources said last month that India was preparing to cut Russian oil imports to below 1 million barrels per day by March, with imports eventually falling to 500,000 to 600,000 barrels per day, compared with last year’s average of 1.7 million barrels per day. By mid-2025, India’s oil imports from Russia will exceed 2 million barrels per day.
Imports of Russian oil by India, the world’s third-largest oil consumer and importer, fell to their lowest level in two years in December, data from trade and industry sources showed.
Indian refiners have been buying more oil from countries in the Middle East, Africa and South America while buying less Russian oil.
Protest brewing
Meanwhile, while New Delhi is pushing for a deal with the United States that would reduce Indian tariffs from 50% to 18%, protests against its decision to open up India’s agricultural sector are growing rapidly.
Indian farm unions and opposition parties Call for nationwide protests Opposed the new India-US trade framework, saying allowing more US imports could harm the agricultural sector, even as the government said key staples were protected.
New Delhi has agreed to lower trade barriers for some agricultural products despite initially staunchly resisting Washington’s demands for a broad opening of India’s agricultural markets.
India is expected to allow imports of protein-rich distillers dried grains with solubles (DDGS), a by-product of ethanol made from corn and other grains, from the United States, adding to a glut in the domestic market.
Increased DDGS supply could benefit India’s nearly $30 billion poultry industry, where feed costs account for approximately 60-70% of total production expenses, by helping reduce costly feed purchases.
However, domestic oilseed processors and soybean growers could suffer if U.S. imports increase. The prospect of duty-free imports of soybean oil, cotton and apples from the United States has also caused some concern in India.
‘Indian farmers at a disadvantage’
protocol has become a political flashpoint, reminiscent of the 2020-21 farm law protests, when the government was forced to repeal three laws aimed at deregulating agricultural markets.
The government defended the deal, saying farmers’ interests were protected by excluding imports of grains such as rice, wheat, corn and dairy products, while growers of basmati rice, fruits, spices, coffee and tea would get duty-free access to the U.S. market.
Farming groups said the agreement puts Indian farmers at a disadvantage.
“We are worried about the India-US trade deal because it will hurt Indian farmers, who are more vulnerable than American farmers,” farmer leader Rakesh Tikait said.
The federal government opposition also expressed concerns about the deal on Monday.
Congress leader Pawan Hera quoted US Agriculture Secretary Brooke Rawlings as saying: “This agreement may make India a dumping ground.” Rawlings said the agreement will boost US agricultural exports to India, increase prices and inject money into rural America.
- Reuters, with additional editing and input by Vishahka Saxena
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