Zero Russian oil unlikely despite India-US trade deal, indicates former HPCL chief

HPCL’s former Chairman and Managing Director MK Surana, while speaking to CNBC-TV18, indicated that while Indian imports of Russian crude are expected to decline, although a transition to zero remains unlikely in the immediate future due to logistical realities and refinery dependencies.

On buying of Russian oil

Surana said, “Whether it [India imports of Russian crude] will become zero, we need to see, because we have one refinery in the country which is purely dependent on Russian crude as of today.”

Also Read: India-US interim trade agreement: Top highlights

“I will put it this way: these are two different issues—buying from Russia or not Russia, and buying from the US or not the US. These are two different issues altogether. Also, a penal tariff on Indian goods in lieu of Russian imports is different from the trade deal, though it was a sticking point.”

Navigating Sanctions

Also Read: Russia backs oil trade with India, says energy ties ‘stable’ despite diversification talk

Drawing parallels to previous negotiations during Iranian sanctions, Surana suggested that the industry would need to examine the intricacies regarding "direct and indirect" imports. Although he said that as the current situation is tied to a significant trade deal, India is likely to navigate these waters with increased caution.

The US has left a window open for revision even as India and the US issued a joint statement on the interim trade agreement, which would bring down the tariff on Indian exports to 18%.

"India has committed to stop directly or indirectly importing Russian Federation oil," according to the White House Statement.

The Trump administration had imposed a 25% additional tariff on Indian goods as a penalty for the South Asian country's continued oil purchases from Russia, sanctioned by the West for invading Ukraine.