A strategy by Donald Trump’s administration to reduce India’s dependence on Russia’s oil is facing new challenges as rising tensions in the Middle East disrupt global energy supplies. The recent conflict involving Iran has effectively threatened shipping routes through the critical Strait of Hormuz, forcing India to reconsider its energy sourcing strategy.
For much of the past year, Washington attempted to weaken Moscow’s finances by limiting its oil revenues. The US pressured India—one of Russia’s largest crude buyers—to reduce purchases. Measures included imposing high tariffs on Indian exports and sanctioning major Russian oil companies. The goal was to cut a key source of funding for Russia following the Russian invasion of Ukraine.
The policy appeared to be working. While India did not completely stop buying Russian oil, it significantly reduced imports and increasingly relied on supplies from Middle Eastern producers such as Saudi Arabia, Iraq, Kuwait and the United Arab Emirates.
However, the situation changed dramatically after a joint military escalation involving the United States and Israel against Iran. The conflict has threatened maritime traffic in the Strait of Hormuz, a narrow passage through which a significant share of the world’s oil supply flows. Nearly 2.5–2.7 million barrels of India’s daily crude imports pass through this route.
As the security situation worsened and Iran warned of potential attacks on regional energy infrastructure, global oil markets reacted sharply. Oil prices recently crossed $100 per barrel for the first time since 2022, reflecting fears of supply disruptions.
With Middle Eastern supplies uncertain, India is now looking again toward Russian crude to maintain energy security. Recognising the situation, the United States recently granted Indian refiners a 30-day waiver allowing them to purchase Russian oil shipments already at sea. US Treasury Secretary Scott Bessent said the decision was intended to keep oil flowing into global markets and avoid a supply shock.
Energy analysts say the shift could push India back toward earlier import levels, when as much as 40–45% of its crude oil came from Russia. However, Russian supplies cannot fully replace the volumes typically shipped from the Gulf, and transport times to India are longer.
India currently holds roughly eight weeks of combined crude and petroleum product reserves, providing short-term stability. Officials say the country is also exploring alternative supply routes and sources.
Experts warn that if tensions in the Middle East continue, global energy markets could face prolonged instability—posing significant challenges for oil-importing economies like India.