US Gives India 30-Day Waiver to Import Russian Oil Amid Supply Disruptions
By Bajaj Broking Team
March 06, 2026
3 mins read
Market News
Synopsis:
The United States has granted India a 30-day waiver to purchase crude from Russia after supply disruptions caused by the Iran–Israel War. The move aims to prevent further tightening in global oil markets as shipping disruptions near the Strait of Hormuz raise concerns over crude availability and energy security.
The United States has granted India a temporary 30-day waiver allowing Indian refiners to purchase Russian crude oil, as the ongoing war involving Iran disrupts global energy supplies and fuels concerns about a sharp spike in oil prices. The waiver was announced on March 6, 2026, by US Treasury Secretary Scott Bessent, who said the measure is intended to ensure that oil continues flowing into global markets during a period of severe geopolitical instability.
The decision comes after Washington had earlier imposed 25% punitive tariffs on India for purchasing Russian crude, arguing that such purchases were indirectly supporting Russia’s war against Ukraine. Those tariffs were revoked last month after India agreed to reduce Russian imports and increase purchases of American energy supplies.
However, the rapidly escalating Iran–Israel war has disrupted oil flows across the Middle East, forcing the US to temporarily ease restrictions on India to prevent further supply shocks.
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Scope and Conditions of the Waiver
The waiver applies only to Russian oil cargoes that had already been loaded onto vessels before the latest sanctions took effect. Many of these shipments were left stranded at sea without buyers as sanctions tightened.
According to the US Treasury’s statement titled “Authorizing the Delivery and Sale of Crude Oil and Petroleum Products of Russian Federation Origin Loaded on Vessels as of March 5, 2026, to India", all transactions necessary for the sale and delivery of such cargoes are permitted until April 4, 2026.
The oil must be offloaded at Indian ports, and the buyer must be an entity organised under Indian law. Bessent emphasised that the waiver is deliberately short-term and “will not provide significant financial benefit to the Russian government", since it only allows transactions involving oil already in transit.
War in West Asia Disrupts Global Oil Supply
The waiver was triggered by severe disruptions in the Middle East following attacks on major energy infrastructure and shipping routes. Iran has effectively blocked the Strait of Hormuz, a crucial maritime chokepoint through which around 20% of global oil flows.
Data from shipping trackers indicates that no fully loaded crude tankers have passed through the Strait of Hormuz since last weekend, as warnings from Iran and rising insurance costs have halted vessel movements.
The conflict has also damaged several key oil facilities. Among the major energy assets reportedly hit are Saudi Aramco’s Ras Tanura refinery and Iraq’s Rumaila oil field, further tightening global supply.
Sharp Rise in Global Oil Prices
The escalating conflict has triggered a significant surge in oil prices.
On Thursday, West Texas Intermediate Crude Oil jumped 7.06% to $80.52 per barrel, marking the biggest single-day gain since May 2020. Meanwhile, Brent Crude Oil, the global benchmark, rose 4.16% to $84.82 per barrel.
Later trading on Friday saw some cooling in prices, with Brent around $82.98 per barrel and WTI near $78.45 per barrel. Despite the brief pullback, US crude prices have climbed about 20% during the week as geopolitical tensions escalated.
India’s Growing Energy Concerns
India is particularly vulnerable to Middle Eastern supply disruptions. The country is the world’s third-largest oil importer, fourth-largest refiner, and fifth-largest exporter of petroleum products.
According to energy research firm Rystad Energy, India currently has access to around 100 million barrels of crude oil, enough to meet approximately 45 days of domestic demand. However, experts caution that prolonged disruptions could create supply concerns beyond the next three to four weeks.
India imports a large share of its crude from the Middle East, and about 40% of those supplies normally travel through the Strait of Hormuz. If the blockade continues, refineries may face increasing challenges in securing cargoes.
Shift in India’s Oil Import Strategy
Over the past year, India has gradually reduced its reliance on Russian crude due to diplomatic and trade pressure from Washington. By January 2026, Russia’s share in India’s oil imports had dropped to below 20% for the first time since May 2022.
However, the ongoing crisis has forced Indian refiners to reconsider their sourcing strategy. Market data suggests that India may have already purchased 6 to 8 million barrels of Russian oil in the past two to three days, while other reports indicate state refiners have bought around 20 million barrels through traders.
Major Indian refiners involved in negotiations include Indian Oil Corporation, Bharat Petroleum Corporation, Hindustan Petroleum Corporation, and Mangalore Refinery and Petrochemicals Limited. Private sector giant Reliance Industries is also reportedly seeking prompt Russian cargoes.
Changing Pricing Dynamics for Russian Oil
The pricing of Russian crude has shifted dramatically amid the supply crunch. Traders are currently offering Russian Urals crude at a premium of $4 to $5 per barrel to Brent for shipments arriving in March and early April.
This marks a stark reversal from February, when similar cargoes were trading around $13 per barrel below Brent, highlighting the sudden scarcity of available crude.
Industry participants say that the availability of oil molecules has become a bigger concern than price, as the war disrupts supply chains across the region.
US Strategy to Stabilise Energy Markets
Washington’s decision to grant the waiver is part of broader efforts to stabilize global oil markets. The US government is also offering political risk insurance for tankers traveling through the Gulf to encourage shipping activity and prevent supply bottlenecks.
US President Donald Trump stated that additional measures may be taken if necessary, noting that the administration is working to increase oil supply and restore market stability.
At the same time, the US has reiterated that it expects India to increase imports of American crude in the future, describing India as an “essential partner” in global energy markets.
For now, the 30-day waiver acts as a temporary safety valve, allowing stranded Russian cargoes to reach Indian ports and easing pressure on the global oil supply chain during one of the most volatile geopolitical crises in recent years.
Published Date :
06 Mar 2026
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This article is for educational purposes only and should not be considered investment advice. Market investments are subject to risks. DSIJ Wealth Advisory Private Limited is a SEBI-registered Research Analyst (Reg. No: INH000006396) and Investment Adviser (Reg. No: INA000001142). Please consult your financial adviser before investing.
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