Impact of Trump's Tariffs on Indian Oil Refiners

Public sector refiners in India, including Mangalore Refineries and Petrochemicals Ltd (MRPL), Bharat Petroleum Corporation, Indian Oil Corporation, and Hindustan Petroleum Corporation, have halted purchases of Russian crude oil from the spot market. This decision comes in the wake of US President Donald Trump's announcement of a 25% tariff on Indian exports, effective from August 7, 2025.

Shift in Oil Procurement Strategies

As the world's third-largest oil-importing nation, India's major refiners, which oversee 60% of the country's refining operations, are now looking to source crude from the Middle East and other countries. This shift is expected to impact gross refining margins due to higher costs compared to Russian Urals.

Government's Stance on Russian Oil Imports

The Indian government has denied issuing any directives to halt Russian crude purchases, despite international media claims. Russia remains a key supplier, with Indian refiners benefiting from price advantages post the Ukraine conflict.

Future of India's Oil Trade

With Russian crude oil constituting over one-third of India's total crude imports, any disruption could lead to a swift transition to other suppliers, potentially driving global oil prices up to $130-140 per barrel.