The India–Russia Energy Trade has witnessed a significant transformation in the post-Ukraine war period, reflecting India’s pragmatic approach to energy security and strategic autonomy. From being a marginal energy partner before 2022, Russia has emerged as one of India’s most important crude oil suppliers.
Pre-Ukraine War Scenario and India–Russia Energy Trade
Before the Russian invasion of Ukraine in February 2022, Russia accounted for only about 1–2 per cent of India’s total energy imports, particularly crude oil. India’s energy basket was dominated by Middle Eastern suppliers such as Iraq, Saudi Arabia, and the UAE. High transportation costs, lack of suitable crude grades, and absence of pricing incentives limited Russian oil’s presence in Indian refineries. Consequently, the India–Russia energy trade remained commercially insignificant despite strong political ties.
Post-2022 Shift and Surge in Imports during India–Russia Energy Trade
The imposition of Western sanctions on Russian energy exports led to the redirection of Russian crude to Asian markets at deep discounts—often USD 20–30 per barrel below Brent prices during 2022–23. India, which imports over 85 per cent of its crude oil requirement, leveraged this opportunity to enhance energy affordability.
As a result, Russian oil imports surged sharply. By 2023–24, Russia became India’s largest crude oil supplier, accounting for around 35–40 per cent of India’s total crude imports, compared to less than 2 per cent before the war. This marked a historic reorientation of India’s energy trade.
Record High Trade in 2024
In 2024, India–Russia energy trade reached a record high, with crude oil forming the bulk of bilateral energy exchanges. India imported over 1.6 million barrels per day (mbpd) of Russian crude at peak levels. The trade also expanded to include coal and discussions on LNG cooperation, while Indian companies continued investments in Russian upstream projects such as Vankor and Sakhalin-1.
Strategic and Economic Implications
Economically, discounted Russian oil helped India contain its import bill, manage inflation, and stabilize domestic fuel prices. Strategically, the trade underscores India’s policy of strategic autonomy, refusing to align with unilateral sanctions while maintaining relations with the US and Europe.
However, excessive dependence on a single supplier raises concerns related to supply risks, payment mechanisms, and geopolitical volatility.
Way Forward
India must balance short-term economic gains with long-term diversification by strengthening ties with the Middle East, investing in renewables, expanding strategic petroleum reserves, and pursuing energy diplomacy.
Conclusion
From a mere 2 per cent share before 2022 to a dominant position in 2024, the India–Russia energy trade exemplifies how geopolitical disruptions can reshape global energy flows, while highlighting India’s adaptive and interest-driven foreign policy.
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