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US Tariffs Shift India's Russian Oil Strategy
18 Feb
Summary
- India may reduce Russian crude oil purchases significantly.
- Deal involves a reduction in US tariffs on Indian goods.
- Gross refining margins could be impacted by the shift.
India's reliance on discounted Russian crude oil, which at one point comprised nearly 35-40% of its imports, is set to moderate. A significant development, anticipated by February 2026, involves India potentially reducing these purchases. This strategic adjustment is in exchange for a decrease in U.S. tariffs on various Indian goods. The effective tariff rate is expected to drop from 50% to 18% as a result of this agreement. Consequently, the advantage India previously gained from procuring crude at lower prices is likely to diminish. This shift could also affect the country's gross refining margins, introducing new economic considerations.
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