India buys Russian oil at steep discount as US ups pressure

Russian crude oil is becoming increasingly affordable for Indian refiners, even as the United States intensifies its diplomatic and economic pressure on New Delhi to curb energy ties with Moscow.

The latest price offers for Urals crude — Russia’s primary export grade — show a widening discount, signaling Moscow’s growing reliance on Asian buyers amid Western sanctions, Bloomberg reports.

According to industry sources familiar with the matter, Russian Urals crude for delivery in late September and October is being offered at a discount of $3 to $4 per barrel relative to benchmark Brent, on a delivered basis. This marks a notable increase from the roughly $2.50 discount observed last week and significantly wider than the $1 differential seen in July, Bloomberg reports.

The price drop comes at a time when US President Donald Trump’s administration has imposed stiff tariffs on Indian goods and stepped up its rhetoric against India’s energy cooperation with Russia. Washington has repeatedly argued that Indian purchases of Russian oil are indirectly helping to finance the Kremlin’s military campaign in Ukraine.

Despite mounting Western criticism, Indian refiners have remained steadfast in their procurement of discounted Russian barrels — a move that continues to bolster the country's energy affordability amid global market volatility. Prime Minister Narendra Modi, under increasing scrutiny, has publicly reaffirmed India’s strategic partnership with Moscow, describing the relationship as vital to national interests.

“Russian crude remains one of the most cost-effective options for Indian refiners,” said one trader familiar with the deals, who requested anonymity due to the sensitivity of the discussions. “Even with logistical challenges and shifting global dynamics, the pricing advantage is hard to ignore.”

By contrast, Indian refiners that have recently purchased American crude have paid premiums of up to $3 per barrel above Dated Brent, underscoring the economic incentive to stick with Russian supplies.

Urals crude, which primarily ships from Russia’s western ports, has become a staple of India’s energy import mix since the outbreak of the war in Ukraine in 2022. India has emerged as the largest importer of Russia’s seaborne oil, capitalizing on the West’s partial withdrawal from Russian energy markets.

By Vafa Guliyeva