India’s economy has gained significant savings from its oil imports from Russia, amounting to around $12.6 billion between April 2022 and June 2025. According to The Indian Express, refiners were able to cut costs by sourcing discounted crude from Russia compared to other suppliers, though the discounts have shrunk over time. The effective benefit was highest in the early years of the Ukraine war but declined to just 2.8% in 2024-25, leading to smaller savings of about $1.45 billion.
The decision to purchase Russian oil has been crucial for India at a time of volatile global energy markets. With nearly 88% of its oil requirements met through imports, India would have faced a much higher import bill had global prices risen further. Analysts argue that India’s continued demand for Russian crude has also helped prevent a sharper surge in international oil prices. A $10 rise in crude could have increased India’s import costs by nearly $58 billion over the 39-month period.
The geopolitical backdrop has added tension to India’s choices. In August 2022, U.S. President Donald Trump imposed a 25% tariff on Indian goods, penalizing New Delhi for buying Russian oil. India called the move “unjustified and unreasonable,” especially given that U.S. and European pressure had already shifted traditional suppliers away from Asia. The tariffs threatened India’s exports to the U.S., worth about $87 billion in 2024-25, even as China—a much larger buyer of Russian oil—faced no such penalties. By contrast, the Biden administration had encouraged India to step up its Russian oil purchases after the Ukraine invasion, warning that cutting off Moscow entirely could push global prices to damaging levels.
India’s imports from Russia have reshaped the supply map. Before 2022, Russian crude made up less than 2% of India’s intake. Within months of Western boycotts, Russia became India’s largest supplier, accounting for more than a third of total imports. The discounts were initially steep: in 2022-23, India saved $31 billion on Russian crude priced at an average of $83.24 per barrel, $13 cheaper than oil from other countries. The savings in 2023-24 rose to $5.41 billion, even as discounts narrowed to 10.4% and the landed price of Russian oil fell to $76.39 per barrel.
The future remains uncertain. With discounts shrinking, the financial benefits to India have diminished, yet experts suggest the real savings are still larger than the recorded numbers, as Indian purchases help moderate world prices. Reports from CLSA warn that if India were to halt Russian oil imports, prices could spike to $90–$100 a barrel, feeding global inflation. Nomura economists calculate that each $1 rise in crude adds $1.8 billion to India’s annual import bill. Losing discounted Russian oil could increase the country’s costs by $11 billion every year.
Ultimately, India’s reliance on Russian crude underscores a balance between economics and geopolitics. While under pressure from the West, India continues to defend its energy security and strategic autonomy. For New Delhi, Russian oil is more than just a commodity—it is a tool to stabilize the economy amid uncertain global markets.
