Moscow has stated that they have not received any official communication from New Delhi regarding a halt in oil purchases from Russia. This statement follows claims made by US President Donald Trump that India had agreed to cease its acquisition of Russian crude oil.
On Monday, President Trump announced that India and Prime Minister Narendra Modi, "one of my greatest friends," had come to a trade agreement. Trump stated that India, the second-largest purchaser of Russian crude, had agreed to stop buying Russian oil after months of pressure from the U.S. He also mentioned that tariffs on Indian goods entering the U.S. would fall from 25% to 18% and that India would buy more oil from the United States and possibly Venezuela.
Kremlin spokesman Dmitry Peskov stated that Moscow has not been informed of any such decision by India. Peskov told reporters, "So far, we haven't heard any statements from New Delhi on this matter". Modi acknowledged the "wonderful" tariff news on X (formerly Twitter) but did not specifically address his country's oil purchases.
Sources indicate that India will limit its crude oil purchases from Russia as part of its agreement with the U.S. in exchange for reduced trade tariffs. However, imports will continue for now by refiners like Nayara Energy, which do not have an alternative source. President Trump stated that India also agreed to lower tariff and non-tariff barriers against the U.S. and commit to purchasing an additional $500 billion of U.S. energy, technology, agricultural products, coal, and other goods. This commitment to halt Russian oil purchases removes the additional 25% punitive tariff previously imposed, effectively lowering the applied U.S. tariff on Indian exports to 18% from 50%, which should provide substantial relief to Indian exporters.
Analysts believe that while imports may not stop entirely, a significant decline could impact tanker tonne-miles and shift demand toward the mainstream fleet. According to Signal Ocean, Indian refiners have not yet confirmed they will completely halt Russian oil imports. Cargoes have already been booked for February and March, with Reliance Industries confirming it is doing so in sanction-compliant deals.
BIMCO data indicates that Russia-India trade accounted for 0.5% and 4.7% of tonne miles in the clean and dirty tanker markets, respectively, last year. BIMCO expects that a reduction or end to Russia-India volumes could significantly impact the dirty tanker segment in particular, as demand could shift from the parallel fleet back to the mainstream fleet.
According to Banchero Costa, head of research, Ralph Leszczynski, India has been promising to reduce its imports of Russian oil for over a year, but little has changed. Leszczynski added that the only reason India is importing Russian oil is that it is cheap, sold at a deep discount because Russian sellers have very few options. He also stated that there is no technical reason why India could not "turn back the clock to 2021" and increase imports from its prewar suppliers.