Oil Debate: India Urges US to Ease Iran, Venezuela Sanctions

Oil Debate: Since the Russia-Ukraine conflict began in 2022, India’s Russian oil imports have grown sharply, reshaping global energy flows and putting New Delhi at the center of a high-stakes geopolitical tug-of-war. Now, facing additional US trade penalties, India is pressing Washington to ease restrictions on crude purchases from Iran and Venezuela to maintain its energy security.

Oil Debate: Rising Russian Oil Dependence

India, which relies on imports for nearly 90% of its crude needs, took advantage of discounted Russian oil when European buyers moved away after the Ukraine war. According to data from Finland’s Centre for Research on Energy and Clean Air (CREA), India has bought Russian fossil fuels worth over ₹148 billion since early 2022, including crude oil worth ₹132 billion. This surge made India the third-largest buyer of Russian fossil fuels, behind China and the European Union.

The flow of Russian crude helped India offset soaring global energy prices, while also reducing the country’s overall import bill. For Indian refiners, these supplies provided both economic and strategic leverage.

US Tariffs Add Pressure

The honeymoon, however, is facing turbulence. With Washington slapping 25% penal tariffs on Indian trade involving Russian crude, and an additional 50% trade tariff burden on India more broadly, the economic equation is shifting. Indian officials, visiting the US this week, reportedly told the Trump administration that any significant reduction in Russian oil purchases would require access to alternative affordable sources such as Iran and Venezuela.

“Restricting refiners from sourcing oil from Russia, Iran, and Venezuela simultaneously could spark a global price surge,” a source familiar with the talks revealed, highlighting India’s concerns.

Commerce Minister Piyush Goyal, during his trip to New York, signaled India’s willingness to expand oil and gas purchases from the US. He emphasized that “our energy security goals will have a very high element of US involvement,” pointing to a potential increase in American energy exports to India if sanctions on Iran and Venezuela remain unchanged.

Oil Debate: Global Energy Balance at Stake

The tug-of-war over India’s Russian oil imports goes beyond bilateral trade—it has implications for global energy stability. India’s growing demand is not only about affordability but also about maintaining consistent supplies amid global volatility. CREA data shows that while China purchased Russian fossil fuels worth ₹268 billion since 2022, India’s ₹148 billion imports exceeded both the EU’s ₹105 billion and Turkiye’s ₹71 billion.

With sanctions blocking Iranian and Venezuelan oil from global markets, India argues that limiting Russian flows further would distort supply chains and drive prices higher for everyone. For Washington, however, easing sanctions carries political risks, especially with oil-rich nations long seen as adversaries.

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