Indian Oil Corporation (IOC), the country’s largest state-run refiner, has resumed purchases of Russian crude for December delivery, according to trade sources. Despite renewed US pressure on India to halt energy imports from Moscow, IOC has secured five cargoes of Russian oil from suppliers not affected by sanctions, ensuring compliance with international rules while prioritising national energy needs.
The development comes close on the heels of Washington imposing fresh sanctions on Russia’s major oil companies Rosneft and Lukoil, broadening its sanctions net and stepping up efforts to contain Moscow’s revenues from the Ukraine conflict. These actions have disrupted supply chains and complicated procurement strategies for many nations dependent on Russian crude. After the latest round of sanctions, several Indian refiners, including Mangalore Refinery and Petrochemicals Ltd (MRPL), HPCL-Mittal Energy Ltd (HMEL) and private-sector major Reliance Industries, which operates the world’s largest refining complex, temporarily paused Russian oil purchases due to sanctions-related risk assessments. However, IOC has reaffirmed its stance that Russian crude shall continue to be sourced as long as shipments comply with sanctions frameworks and do not involve restricted entities.
In recent days, IOC reportedly acquired around 3.5 million barrels of ESPO blend crude, priced at parity with Dubai benchmarks, for delivery to an east-coast port in December. While suppliers have not been disclosed due to commercial sensitivities, sources said the purchase highlights India’s pragmatic approach that protects supply security and keeps costs under control at a time of volatile global markets. ESPO crude, traditionally shipped from Russia’s Pacific port of Kozmino to Chinese buyers, has seen sharply reduced demand as China’s state-refiners halted spot purchases following US curbs. Independent refiners in China have also neared their import quota caps, tightening their intake.
This fall in Chinese interest has pushed ESPO discounts deeper, making Russian cargoes more economically viable for Indian refiners. India, which has emerged as the largest buyer of Russian seaborne crude over the past three years, has benefited from lower prices while maintaining diversification in its supply basket. Indian officials have consistently underlined that the country’s decisions are guided solely by national interests, especially securing affordable energy for a growing economy and for protecting consumers from global price shocks.
Russia emerges as India’s top sunflower oil supplier
While the global spotlight remains on crude oil, a parallel shift has transformed India’s edible oil market. Russia has rapidly become India’s leading sunflower oil supplier, overtaking Ukraine, the traditional trade partner in this segment. Sunflower oil accounts for a significant portion of household consumption in India, ranking among the three most consumed edible oils in the country. Yet, domestic production meets only around 5 per cent of national demand, leaving India reliant on imports to bridge the gap.
Over the last four years, India’s sunflower oil imports from Russia have skyrocketed twelve-fold. Trade engagement between the two nations has expanded, with delegations from industry and government actively coordinating to ensure smooth supply chains despite wider geopolitical tensions. Sector representatives highlight that Russian supply has proven more stable, predictable and competitively priced, offering India confidence in regular availability.
Russia’s share surges; Ukraine’s declines
Russia’s share in India’s total sunflower oil imports, once a modest 10% in 2021, has surged to 56 per cent in 2024. Official figures show India imported approximately 2.09 million tonnes of sunflower oil from Russia in 2024 alone, a massive jump from just 175,000 tonnes (1.75 lakh tonnes) three years earlier. Ukraine, meanwhile, has experienced a sharp decline in its share. Before the war, Ukraine served as India’s primary supplier, exporting over 90 per cent of its agricultural produce via sea routes through Black Sea ports. With those ports blocked during the conflict, Kyiv was forced to divert shipments to Europe and rely on slower, costlier rail and road transport, significantly reducing its competitiveness in the Indian market.
India imports nearly 60 per cent of all edible oil it consumes. Palm oil remains dominant with nearly half of the total import share, while soybean and sunflower oils rank second and third, respectively. The consumption shift toward sunflower oil deepened further in 2023 and 2024, as international prices of sunflower oil dropped sharply, at times becoming cheaper than palm oil for the first time in decades.
