India’s expenditure will increase directly in the current financial year if oil imports from Russia stop
America Under the pressure of India, if India stops buying crude oil from Russia, its cost of importing crude oil can increase to $ 9 billion to $ 12 billion. This information is given in a report by State Bank of India (SBI). The report states that if India stops importing crude oil from Russia for the rest of the FY 2026, the country’s fuel bill may increase in FY 26 and $ 11.7 billion in FY 27 due to the increase in prices.
Russia contributes 10 percent in global crude oil supply
Currently, Russia contributes 10 percent of Global crude oil supply. If all countries stop purchasing crude oil from Russia, then crude oil prices can increase by about 10 percent, provided no other countries increase their production. India has greatly increased the purchase of Russian oil since 2022, which was sold at a discount of $ 60 per barrel to ensure energy security after the Western countries ban and avoid their supply after the invasion of Ukraine.
Iraq was India’s largest oil supplier before Ukraine War
As a result, Russia’s stake in India’s total oil imports increased from just 1.7 percent to 35.1 percent in FY 2025 in FY 2020, making Russia India’s largest oil supplier. In terms of volume, India imported 88 million metric tons (MMT) crude oil from Russia in FY 2025, one of its total 245 MMT oil imports.
Prior to the Ukraine War, Iraq was the largest crude oil supplier in India, followed by Saudi Arabia and the United Arab Emirates (UAE). Indian refiners usually buy oil from Middle Eastern producers through annual contracts, which facilitates excess supply every month. Since Russia was banned, the refiners have also moved the oil suppliers from the US, West Africa and Azerbaijan.
India imports crude oil from 40 countries
India has expanded its oil sources to about 40 countries. New supply options have emerged from Guyana, Brazil and Canada, which has increased the country’s energy security. If the supply of crude oil from Russia is stopped, India can return to its traditional Middle Eastern suppliers under existing annual agreements, ensuring flexibility in meeting its import needs.
The SBI report highlights that a potential increase in the import bill is important, but India’s comprehensive supply network and contracts established with other oil producing countries can help reduce this effect. However, due to decrease in Russian exports, the increase in global crude oil prices will increase the cost.
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