India slashed oil imports from U.S. and Russia in Sept.

Why in the News

India cut its crude imports from the United States to zero in September and pulled Russia’s share down from an all time high of about 51% in July to 33%, with the United Arab Emirates (UAE) filling the gap. The shift followed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, a United States law that lets Washington tax large buyers of Russian oil and gas, and Russia and the UAE still supply 60% of imports.

What is the sanctions Act, and why did India change its buying?

1. What it is: The Act lets the United States levy tariffs of up to 100% on large buyers of Russian oil and gas, such as India and China, like a penalty on a sanctioned seller’s customers.
2. Passage: The US House of Representatives passed it on September 16, and the President signed it on September 18.
3. Tariffs paused: On October 16 the President signed an executive order temporarily waiving the tariffs and certified to Congress that the pause is in the US national interest.
4. Next data: India’s government data on October oil imports will be released next month.
5. The takeaway: India shifted its buying as soon as the Act was signed, and the waiver is temporary, so the choice between suppliers is still open.

How has India’s mix of crude suppliers moved?

1. Russia’s rise: Russia’s share climbed steadily from February, when the United States scrapped its penal tariffs linked to Russian oil on India, and peaked in July.
2. Hormuz effect: The peak coincided with the closure of the Strait of Hormuz in the West Asia war, which constrained supply from that route.
3. Fall since: Russia’s share fell to 44% in August and fell again in September, the month the Act was signed.
4. Volume view: India raised its total crude imports in September but cut Russian imports by nearly 18% from August.
5. US pressure pattern: India had also cut Russian imports under American pressure before the penal tariffs were removed in February, so Russia’s share has broadly followed US actions.

Why is the import bill rising faster than the quantity?

1. Volume: India imported almost 10% more crude than in August and about 4% more than a year earlier.
2. Bill: The import bill rose by a third on the year and by about a sixth on August.
3. Price effect: Crude prices have stayed elevated for about six months, and a year earlier oil was relatively cheaper, so India pays much more for slightly more oil.

Challenges

1. Concentration risk: Two suppliers provide most of India’s crude, so a disruption at either one hits supply and prices at once.
2. Thin reserve cover: India’s total crude cover of 74 days falls short of the 90 day norm of the International Energy Agency (IEA), so a supply shock is cushioned for less time.
3. Policy exposure: A temporary US waiver means tariffs can return, and India’s buying would then change again with Washington’s decisions.

Way Forward

1. Wider supplier base: Spread purchases across more producers so that no two suppliers decide India’s price and security.
2. Larger reserves: Build Phase II strategic storage through Indian Strategic Petroleum Reserves Limited (ISPRL) under the public private model to close the gap to the 90 day norm.
3. Durable US understanding: Seek a lasting exemption in trade talks instead of relying on a temporary waiver.

Conclusion

India has shown it will rebalance its crude buying within a month when a tariff threat arrives, but the pause leaves the threat standing and the sourcing concentrated. The next monthly import data will show whether the cuts hold as long as the tariffs stay paused.

Key numbers

1. September crude volume: 209.4 lakh tonnes, 9.5% above August and 4.1% above September 2025.
2. September import bill: Nearly $14.3 billion, 16.4% above August and 33% above September 2025.
3. Strategic storage: 5.33 million tonnes in three underground caverns at Visakhapatnam, Mangaluru and Padur, about 9.5 days of imports.

Matching Previous Year Question

“No direct PYQ traced in the provided files. Thematic PYQ: [2025, GS2, 15 marks] “Energy security constitutes the dominant kingpin of India’s foreign policy, and is linked with India’s overarching influence in Middle Eastern countries.” How would you integrate energy security with India’s foreign policy trajectories in the coming years?”