India seeks US nod for Iranian crude oil as alternative to Russia

Indian officials have told the Trump administration that they would only be able to cut back on Russian oil imports if Washington permitted crude purchases from Iran and Venezuela, both of which face US sanctions.

According to a person briefed on the talks, an Indian delegation visiting the United States this week repeated the request during meetings with American counterparts. People familiar with the negotiations said Indian representatives stressed that restricting supplies from Russia, Iran, and Venezuela at the same time could push global oil prices higher.

The US embassy in New Delhi did not comment on the substance of the discussions, though a spokesperson noted that India’s reliance on Russian crude was seen in Washington as undermining efforts to counter Moscow’s activities. India’s Commerce and Oil Ministries did not respond to inquiries on the matter, Bloomberg reported.

Indian officials travelled to the United States for discussions after Washington imposed steep tariffs on the country in retaliation for its oil trade with Russia. Despite these measures, India has continued to import from OPEC+ producers, though at reduced levels.

During a visit to New York, Commerce Minister Piyush Goyal said India aimed to expand its purchases of US oil and gas, emphasising that American supplies would play a major role in the nation’s energy security goals and would have a very high element of US involvement.

Russia has been selling crude at discounted rates after many countries cut back trade with Moscow following the invasion of Ukraine. Since India imports nearly 90% of its oil, the cheaper Russian barrels have helped ease its import costs. Iranian and Venezuelan crude, if available, would similarly be priced lower.

India stopped importing oil from Iran in 2019, and Reliance Industries, the country’s biggest private refiner, ended its purchases of Venezuelan crude earlier this year due to tighter US sanctions. While Indian refiners can source more oil from the Middle East, officials say this would come at a higher cost and further increase the overall import bill.

Commerce Ministry data shows that in July Indian refiners paid an average of $68.90 per barrel for Russian crude, compared with $77.50 for Saudi oil and $74.20 for American supplies. India is currently the largest buyer of Russian seaborne crude, while China remains the biggest overall importer when pipeline deliveries are included.

The oil market is also expected to see a huge surplus next year as the OPEC+ coalition and non-OPEC producers increase supply, putting downward pressure on global crude prices.