Indian refineries began looking for a replacement for Russian oil due to the threat of US sanctions - Bloomberg

India's largest oil refining companies have begun to actively seek an alternative to Russian oil and may reduce its purchases for November deliveries after the new US sanctions law takes effect.

According to Bloomberg, over the past few days leading Indian refineries have seriously started considering alternative crude shipments. Negotiations on Russian oil for November delivery typically begin at the end of September, so the next procurement cycle will take place under new sanctions risks.

On September 18, US President Donald Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026. The law expands sanctions against Russia and gives the US administration the ability to impose tariffs on countries that remain major buyers of Russian energy resources.

Such tariffs could reach 100%. Among the countries potentially affected by the restrictions is India—one of the largest buyers of Russian seaborne oil.

Supplies from Russia have already begun to decline. According to Kpler estimates, India may import about 1.9 million barrels of Russian oil per day in September. That's over 35% of the country's total oil imports, but the lowest level since April.

At the same time, quickly replacing Russian volumes will be difficult. In previous months, Russia's share of Indian imports at certain periods exceeded half of all supplies, while the availability of crude from the Middle East remains limited.

At the end of last week, Russian Urals delivered to India cost about $133 per barrel, according to Argus Media. Middle Eastern grades Oman and Murban were still a few dollars more expensive.

The situation marks a shift from the Indian refineries' position immediately after the bill was passed by Congress. As recently as September 18, industry representatives stated they would continue buying Russian oil due to the difficulty of replacing it quickly. Now the risk of US tariffs is forcing the largest refiners to at least prepare alternative supply options.

Based on materials from: Bloomberg, White House, Business Standard