In January 2025, the United States rose to become India’s fifth-largest crude oil supplier, with imports soaring to 218,400 barrels per day (bpd), a sharp jump from 70,600 bpd in December 2024. This surge highlights India’s efforts to diversify its energy sources amid growing geopolitical tensions and tightening sanctions on Russian oil. Russia maintained its lead as India’s top oil supplier, with imports increasing by 4.3% to 1.58 million bpd during the same period.

However, fresh U.S. sanctions imposed on January 10, 2025, targeting key Russian oil producers and shipping fleets, are expected to affect future Russian crude deliveries to India. Under these sanctions, Indian refiners must ensure they purchase Russian oil only from non-sanctioned companies and vessels, complicating procurement processes.

The full impact of these measures is anticipated by March 2025 as existing contracts come up for renewal under the new compliance rules. Indian Oil Corporation Limited has already suggested it may scale back Russian crude purchases if compliant shipments become harder to secure. This is likely to prompt Indian refiners to turn to alternative suppliers in the Middle East and the U.S. to mitigate supply risks.

India’s overall crude imports in January reached approximately 5.1 million bpd, with Middle Eastern oil making up around 53%—the highest share in over two years. Iraq, Saudi Arabia, and the UAE followed Russia as India’s key suppliers. In response to evolving market dynamics, India aims to boost its energy trade with the U.S., targeting $25 billion in purchases this year—up from $15 billion in 2024.

Disclaimer: This image is taken from Reuters.