Amidst Trump’s tariffs, India buys more US oil - competitive prices at play; trade deficit to narrow

Indian refiners have stepped up their purchase of US oil in August, as competitive prices have enhanced the appeal of American crude. The move comes at a time when the Donald Trump administration has imposed 50% tariffs on Indian goods exported to the US.

According to a Reuters report, the higher purchase of US crude oil could potentially reduce India's trade imbalance with the United States during a period of diplomatic strain between both countries.


India’s leading refinery, Indian Oil Corp, has secured 5 million barrels of US West Texas Intermediate crude through a tender process for delivery in October and November, sources were quoted as saying by Reuters.

Indian Oil Corp has procured seven million barrels of US West Texas Intermediate (WTI) crude from various international traders for delivery between April and May.

This development follows Bharat Petroleum Corp’s acquisition of two million barrels of US WTI crude, whilst Reliance Industries obtained two million barrels of WTI crude through Vitol, the report said.

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Indian refineries, alongside their Asian counterparts, increased their orders when US crude became economically viable for Asian markets. Additionally, India faces increased pressure to purchase American oil following the United States' decision to increase tariffs on Indian imports to 50%, citing India's Russian oil procurement.

The sources indicated that European traders Gunvor and Equinor each supplied two million barrels, whilst Mercuria provided one million barrels to IOC.

They further noted that BPCL has initiated its first procurement of Nigerian Utapate oil, demonstrating its strategy to diversify its crude sources with new varieties.

India firm on Russia crude oil procurement

Even as India has stepped up US crude oil purchases this month, it stands firm on its strategic autonomy in procuring Russian crude.

Last week external affairs minister S Jaishankar addressed US allegations of profiteering from Russian crude. "It's funny to have people who work for a pro-business American administration accusing other people of doing business. If you have a problem buying oil or refined products from India, don't buy it. Nobody forces you to buy it. Europe buys, America buys, so you don't like it, don't buy it,” Jaishankar asserted.

Meanwhile, according to another Reuters report, Indian refiners are planning to boost their Russian oil imports in September.


Following Western sanctions on Moscow after its Ukraine invasion in 2022, India emerged as the primary purchaser of Russian oil supplies that were previously directed elsewhere. This strategic shift has enabled Indian refineries to access crude at more competitive prices.

According to trading sources quoted in the report, the country's refiners are set to increase their Russian oil acquisitions in September by 10-20% compared to August volumes, which is an additional 150,000-300,000 barrels per day.

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