Oil has always been not only a source of energy for India, but it has also been an important pillar of its foreign policy and economic stability. For a country with a population of 140 crore, the question of energy security is directly related to inflation, growth rate and social stability, but as energy trade is becoming a weapon in global politics, India’s oil import is also no longer just an economic decision. The US’s threats of tariffs and sanctions on its trading partners related to Russia and Iran have further increased this sensitivity.

After the Ukraine war, India gave relief to its domestic economy by purchasing cheap crude oil from Russia, but now there is strict monitoring and pressure from America regarding this decision. On the other hand, the American proposal to open Venezuelan oil to India is being considered a major strategic turning point in this entire incident. The question is whether India will be able to take independent decisions for its energy needs or will it have to change its policy according to the global balance of power?

India’s energy dependence and strategic compulsion

India is the third largest oil importer in the world. About 90 percent of the country’s crude oil needs are met through imports. Oil plays an important role in every sector like transportation, power generation, industry, agriculture and logistics. In such a situation, even a slight fluctuation in oil prices in the global market has a direct impact on inflation, rupee exchange rate and government subsidies in India. Before the Ukraine war, India’s oil imports were mainly dependent on Middle-Eastern countries, but after the war, due to Western sanctions, Russia provided crude oil at concessional rates. India took advantage of this opportunity and gave priority to economic stability along with energy security. This decision is making India a sensitive partner in the eyes of America today.

Oil purchases from Russia and US tariff pressure

After the Ukraine war, America and its allies imposed comprehensive economic sanctions on Russia. Although India did not formally participate in these sanctions, it faced constant diplomatic pressure to buy oil from Russia. According to reports, India has purchased crude oil worth more than 140 billion euros from Russia since 2022. US President Donald Trump made this issue more aggressive. He threatened to impose tariffs of up to 500 percent on countries buying oil from Russia, such as India, China and Brazil.

Fear of Iran and 25 percent additional tariff

America has announced to impose 25 percent additional tariff on Iran’s trade partners. India has been an important trading partner of Iran. Be it oil import or strategic projects like Chabahar Port. In such a situation, it is feared that this new tariff may be applicable to India also.

venezuelan oil

The most interesting twist in this entire incident has come regarding Venezuelan oil. America is now ready to sell Venezuelan oil to India. This is the same Venezuela from which India had earlier stopped buying oil due to US sanctions.

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Global discussions are intensifying regarding political and geo-economic changes in Venezuela. According to reports and the Global Trade Research Initiative, if the balance of power there changes and US sanctions are eased, the overall impact on India may be limited, as the current trade between the two countries is very low. However, in the period 2000–2010, India used to import crude oil from Venezuela on a large scale. ONGC Videsh, IOC and Oil India had also invested in Orinoco Belt, but after 2019 this business almost stopped due to US sanctions. In today’s situation, Reliance Industries can get the most benefit. The Jamnagar refinery can process heavier Venezuelan crude, which is cheaper. Margins and profits can increase if imports become easier, signs of which are visible in the market.

US President Donald Trump once claimed on Saturday (25 October 2025) that India has completely cut oil imports from Russia. He said that this step of India is a big step towards strategic partnership with America. However, India has earlier rejected all such claims and clarified that the decision to purchase oil is based on its national interests and not on external pressures.

The Trump administration said that economic and financial sanctions are being imposed on these companies to prevent the Russian energy sector from funding the war machine. These sanctions include freezing the assets of two Russian companies Rosneft and Lukoil in the US, barring American citizens from any financial transactions with them and appealing to global partner countries to maintain trade distance with them. The move is a direct hit to Russia’s economy as Rosneft and Lukoil control about 45% of Russia’s total oil exports.

What is India’s stance on Russian oil?

Soon after Trump’s claim, Indian Foreign Ministry sources once again reiterated that India will continue to buy crude oil from Russia as it is an important part of energy security and cheap supply. India says that unless there is an official ban at the United Nations (UN) level, no country can stop it from buying oil from a particular seller.

An official of India’s Energy Ministry said on condition of anonymity that our priority is to ensure that India gets cheap and stable oil. We cannot compromise with our interests. Trump has earlier also claimed that India will gradually stop buying oil from Russia, but India’s purchase figures show that Russia is still India’s largest crude oil supplier, ahead of Saudi Arabia and Iraq.

Trump’s next diplomatic move

Trump also said during his announcement that he expected a full trade deal when he met with Chinese President Xi Jinping in South Korea. He said that we will also talk about fentanyl (a deadly drug) and agricultural trade. It is killing many Americans and it comes from China. This meeting is taking place at a time when tension between America and China is at its peak regarding technical restrictions, trade balance and raw material supply chain.

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Amidst tension in the Middle East, Iran’s Parliament has now been approved to close the hormun Strait. After this, now the supply chain of crude oil is expected to be affected due to its closure. However, Petrol Minister Hardeep Singh Puri said that there is no shortage of crude oil and the government is closely eyeing it. But, despite the US air strike on Iran’s nuclear installations, if the oil transport sea route closes the Iran Hormun Strait, then India is not going to make much difference.

Straight of hormun closure will not affect

According to industry experts, if the hormun strandary is closed, then there will be many options to import oil across India. From countries from Russia to America and Brazil, India can import oil of its need as an alternative source.

As soon as the tension between Iran and Israel increased the Iranian Parliament has approved the closure of Hormun Strait. From here, about 20 percent of the total oil and gas supply of the world is transported by this waterway. India imports about 40 percent of its oil and gas needs from this part. This hormuz is located between Iran in the north and Oman in the south and the United Arab Emirates. It is a major part of oil transport from major oil producing countries Saudi Arabia, Iran, Iraq, Kuwait and UAE.

India depends on imports 90% oil

India imports about 90 percent of its needs, out of which about 40 percent of which comes from the countries of Midil East via this hormun Strait. India imports about 51 lakh barrels of oil, which is converted to the refinery and prepared petrol and diesel.

But, due to the closure of this route, India oil prices are sure to increase, but it will not have much effect in India. As soon as tension in the middle East increased, India increased the purchase of oil from Russia in June. Middle East supplier increased oil imports from countries such as Saudi Arabia and Iraq. The oil hormun imported from Russia comes via a suicide canal separate from the strait. Apart from this, countries like America, West Africa, Latin America are also in option for oil backup countries as an alternative.

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