India’s strategic import of Russian crude oil over the past three years has been a crucial factor in helping the country save billions of dollars amidst a volatile global energy market. Official estimates show that India saved roughly $12.6 billion during a period of 39 months by importing Russian oil at significant discounts compared to oil from other sources. However, experts believe the actual savings are likely much greater because India’s large-scale purchases from Russia helped keep world oil prices from surging further, stabilising India’s overall fuel import costs. This article details the financial, economic, and geopolitical aspects of India’s reliance on Moscow’s oil supplies since the onset of the Ukraine conflict and the Western sanctions against Russia.

Direct Savings and Expanding Import Volumes

Since early 2022, following Russia’s invasion of Ukraine and subsequent sanctions by the West, Russia aggressively offered its crude oil at marked-down prices to alternative buyers, including India. India responded by becoming one of the largest importers of Russian oil, with Russia supplying about 36 to 40 per cent of India’s total crude imports in recent years. Between January 2022 and mid-2025, India imported Russian crude worth billions of dollars, significantly reducing its overall import bill compared to sourcing from traditional suppliers such as Saudi Arabia, Iraq, and the UAE. For instance, in the first seven months of 2025 alone, Russian crude made up half of the imports at Reliance’s Jamnagar refinery, one of India’s largest refining complexes.

The total savings attributed to this discounted Russian oil reached approximately $12.6 billion over 39 months, a figure calculated by comparing the discounted prices India paid to the prevailing prices from other suppliers. Indian refiners Reliance Industries and Nayara Energy led these imports, with the former’s imports soaring from a negligible 3 per cent of its crude base before the Ukraine war to about 50 per cent by 2025. This change not only translated into direct financial benefits but also underscored India’s growing energy ties with Russia amidst an evolving geopolitical landscape.

Stabilising Global Oil Prices and Its Broader Impact on India

While the direct savings are significant, analysts argue that the indirect advantages might be even higher. India’s willingness to absorb a large share of Russian crude oil that Western countries shunned helped prevent a severe supply glut that could have triggered disruptive price volatility. Had India not stepped in to purchase millions of barrels daily—approximately 1.5 million barrels per day according to mid-2025 data—it is likely global crude prices would have surged, pushing India’s overall oil import bill far higher than current levels.

Furthermore, by maintaining these import levels, India played a stabilising role in the global oil market, benefiting many other oil-importing nations indirectly. This strategic balance was vital when crude prices were extremely volatile, peaking at around $139 per barrel during periods of geopolitical stress. The discounted Russian supplies allowed Indian refiners to utilise cheaper crude, exerting downward pressure on domestic fuel prices and helping keep inflationary pressures somewhat in check. India’s energy security was also bolstered by diversifying away from reliance on more expensive Middle Eastern and African suppliers.

India’s Strategic Energy Policy Amid Global Pressure

India’s approach to increasing Russian oil imports reflects a pragmatic energy strategy, balancing cost savings with geopolitical considerations. The government and industry players have been clear that India’s primary concern is meeting the country’s growing energy demand at affordable rates. While some Western countries have criticised India for continuing to buy Russian oil despite sanctions, India asserts its sovereign right to diversify energy sources to secure developmental needs.

India has also faced external pressures such as the US imposing tariffs on entities importing discounted Russian oil. Despite these challenges, several Indian refineries, including Reliance and Nayara Energy, have maintained or even expanded their Russian crude intake. This steadfast approach underscores India’s commitment to energy security and economic stability over political alignments. By leveraging the discounted Russian oil, India aims to moderate fuel costs domestically, which has direct implications on inflation and the broader economy.

Economic and Trade Implications Beyond Direct Savings

The financial benefits from Russian oil imports extend beyond immediate savings on the import bill. The discounts allowed refiners to pass on some cost benefits to consumers, helping stabilise petrol and diesel prices in India’s vast market. Lower energy costs support multiple sectors, including transportation, manufacturing, and agriculture, critical to the country’s economic growth.

Moreover, the large volume of Russian crude imports helped India negotiate better terms with other oil producers by creating competitive pressure in the global oil market. This indirectly helped India keep a lid on the prices offered by conventional suppliers in the Middle East and elsewhere. Experts also argue that India’s energy trade relationship with Russia has geopolitical significance, potentially strengthening bilateral ties beyond oil and gas, including defence and technology cooperation.

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