New Delhi: India would be willing to step up its purchases of American oil and gas if prices are competitive, a senior government official said, at a time when New Delhi has come under intense US pressure for buying discounted Russian crude.
Union commerce secretary Rajesh Agarwal, who left for Washington on Wednesday to join the negotiations for the bilateral trade agreement (BTA) with the US, said that India is open to increasing its crude and gas imports from the US if prices remain viable for domestic refiners.
India, on average, imports $12–13 billion worth of crude oil and gas from the US every year. There is headroom for an additional $12–13 billion in purchases without requiring any changes to refinery configurations, he said, adding that India will consider buying more energy products, keeping in view the cost dynamics.
“Our team is currently in the US, holding discussions with American counterparts on energy trade and related cooperation,” Agarwal said on the sidelines of a press conference held to announce the monthly trade data.
The Indian team will hold trade pact discussions with their counterparts till 17 October.
His comments come against the backdrop of the US decision to impose an additional 25% tariff on India’s exports for buying Russian oil, a measure that is expected to sharply raise costs for Indian refiners and complicate New Delhi’s energy diversification strategy. Indian exports to the US now face 50% tariffs.
“To secure a deal, India may eventually have to halt its imports of Russian oil unless the US court strikes down the current levy. The earlier price discounts on Russian crude are no longer available, and with the narrowing price gap, India’s purchases of Russian oil are likely to taper off in the coming months,” said Ajay Srivastava, co-founder, Global Trade Research Initiative (GTRI), a think-tank.
The US has said that India’s purchases of Russian oil fuel Moscow’s war against Ukraine.
Earlier, US Treasury Secretary Scott Bessent said on 10 October that India is expected to begin shifting its energy imports, reducing purchases of Russian oil.
Bessent had said, “Do you think, in your estimation, you’ve run all the numbers, would this war be possible now, were it not for China and India’s involvement in those purchases? Absolutely not. So they’re keeping the war going.”
Mint reported on 25 September that the US has asked India to give an assurance, possibly in writing, that it will taper its purchases of Russian oil and boost imports of American crude before a trade deal between the two nations can be finalised.
Energy imports have become the main sticking point in the ongoing talks, which are being steered by US trade representative (USTR) Jamieson Greer, and not by commerce secretary Howard Lutnick.
The Indian negotiating team is also expected to discuss other contentious issues such as agriculture, dairy, genetically modified (GM) crops, and non-tariff barriers during the talks. The US has been insisting on deeper market access for its agricultural and dairy exports, areas that remain a red line for India.
India’s state-owned refiners reduced purchases of Russian oil by more than 45% between June and September this year, according to data from Kpler. The data show that refiners imported around 600,000 barrels per day (bpd) of oil from Russia in September, a significant decline from about 1.1 million bpd in June.
Historically, Russia wasn’t India’s primary source of crude oil. After Russia’s invasion of Ukraine in February 2022, India ramped up its oil imports from a negligible 0.2% of total imports to 35–40%, saving an estimated $17 billion through discounted purchases.
India has also signaled its willingness to make concessions amid the ongoing trade tensions by waiving the 11% duty on cotton imports until the end of the year, in what is seen as a gesture towards the United States.
As per the commerce ministry data, bilateral trade between India and the US stood at $71.41 billion in H1 FY26, up by 11.8% from $63.89 billion in H1 FY25. Exports to the US grew by 13.4%, rising from $40.42 billion in H1 FY25 to $45.82 billion, while imports increased by 9% from $23.47 billion to $25.59 billion.