(Image Source: The Economic Times)
India’s imports of Russian oil are poised to drop sharply in January after Reliance Industries said it expects no deliveries of Russian crude this month. The company stopped importing Russian oil for its Jamnagar refinery in November to comply with new EU sanctions and US restrictions on major Russian oil producers. India bought roughly 1.7 million barrels per day from Russia in 2025, but that figure had fallen to about 1.2 million barrels daily by December, a 40 percent decline from June peaks.
Reliance’s Decision to Stop Russian Oil
The November Halt and Reasoning
Reliance Industries, India’s largest buyer of Russian crude, accounted for approximately half of India’s Russian oil imports through 2025. The company signed a 25-year supply deal with Russia’s state-owned Rosneft in December 2024 for up to 500,000 barrels per day. That contract now sits idle.
The company halted Russian crude imports effective November 20, 2025, ahead of an EU ban on fuel made from Russian oil processed through third countries, which takes effect January 21, 2026. The move also preceded US sanctions on Rosneft and Lukoil that kicked in on November 21, 2025. Reliance stated it decided to ensure full compliance with product-import restrictions coming into force.
Denial of Recent Reports
On January 5, 2026, Reliance firmly denied a Bloomberg report claiming three tankers carrying 2.2 million barrels of Russian crude were heading to its Jamnagar refinery. The company said it has not received any Russian oil cargo in the past three weeks and is not expecting any deliveries in January.
Key points on Reliance’s stance:
No Russian oil received in three weeks as of early January 2026
Not expecting any deliveries for the entire month of January
Called the Bloomberg report “blatantly untrue.”
Expressed concern that the publication ignored its denial before running the story
What This Means for India’s Total Imports
Expected Drop in January and Beyond
With Reliance out of the market for Russian oil, India’s total Russian crude imports are expected to fall below 1 million barrels per day in January, according to officials tracking the flows. That would mark a three-year low and a roughly 60 percent drop from June 2025 levels when imports peaked around 2 million barrels daily.
India has become the only major outlet for Russian oil as Western nations and their allies have reduced purchases. Chinese imports remain substantial, but China’s demand softened after Beijing negotiated lower prices directly with Moscow.
Remaining Buyers
Indian state-run refiners continue to purchase Russian oil, though at lower volumes:
- Indian Oil Corporation
- Bharat Petroleum
- Hindustan Petroleum
- HPCL-Mittal Energy
- Nayara Energy (which has ties to Rosneft)
None of these buyers has the scale of Reliance’s former operations, meaning total volume will drop significantly.
US Pressure and Geopolitical Context
The Tariff Strategy
The sharp reduction comes after months of US pressure on India. In August 2025, President Donald Trump imposed an additional 25 percent tariff on Indian goods specifically for purchasing Russian oil, bringing total US tariffs on India to 50 percent. Trump administration officials argued that Indian oil purchases finance Russia’s war effort in Ukraine.
The White House publicly welcomed Reliance’s November decision to stop importing Russian oil, signaling it looked forward to advancing meaningful US-India trade discussions. This messaging gave Indian refiners and the government a clear signal that compliance would improve US-India relations and potentially lead to tariff reductions.
India’s Balancing Act
Government Monitoring and Energy Security
India has sought to balance its energy security needs with pressure from the United States. New Delhi has asked refiners to provide weekly disclosures of Russian and US oil purchases, signaling government monitoring of import flows. The government appears willing to accept higher oil costs from alternative suppliers to reduce Russian dependence.
Impact on Reliance
Reliance’s decision to scale back from Russian oil reflects sensitivity to geopolitical risk and US pressure. However, the move carries high costs:
- Must find alternative supplies at higher prices
- Refinery margins will be compressed
- Loses the advantage of cheaper Russian crude for export-focused operations
- Becomes competitively disadvantaged versus global competitors
The Rosneft Contract Status
The 25-year, 500,000 barrels per day supply agreement Reliance signed with Rosneft remains on paper but inactive. Under current sanctions, Reliance cannot legally purchase from Rosneft without violating US and EU restrictions. Whether the contract ever resumes depends on changes to geopolitical conditions and sanctions regimes, neither of which appears likely in the near term.
