Putin ends India oil discounts, demands full price for Russian Urals crude: Report
Russia has reportedly told India it will no longer sell crude oil at discounted prices, ending a years-long arrangement that benefited both nations, as the Middle East conflict sends global energy markets into turmoil and oil prices past $100 per barrel for the first time since 2022.
"You stopped buying our oil without informing us... Now suddenly you want it again?" President Vladimir Putin is believed to have said in remarks directed at the Indian government, according to bne IntelliNews. Putin has reportedly said that any future oil sales to India would be conducted on purely commercial terms rather than at the previous preferential rates.
The reversal is stark. As recently as late February, Russian Urals crude was selling to Indian refiners at discounts of $10 to $13 per barrel below the Brent benchmark. Now, traders report Urals is commanding a $4 to $5 premium over Brent for deliveries arriving at Indian ports in March and early April.
The shift was driven by the closure of the Strait of Hormuz following the launch of Operation Epic Fury on February 28, which cut off roughly 20 percent of global oil supply.
Oil prices surged past $100 per barrel on Sunday, with Brent crude rising more than 40 percent from pre-conflict levels, according to the New York Times. Indian state refiners -- Indian Oil Corporation, Bharat Petroleum, and Hindustan Petroleum -- have scrambled to secure around 20 million barrels of Russian crude.
The US Sanctions Waiver
The buying spree was made possible by a 30-day sanctions waiver issued by the US Treasury Department on March 6. Treasury Secretary Scott Bessent announced on social media that the measure would "alleviate pressure caused by Iran's attempt to take global energy hostage."
The waiver, which expires April 4, covers Russian oil loaded onto vessels before March 5, provided it is delivered to Indian ports and purchased by Indian firms, according to Bloomberg.
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The Kremlin is also punishing New Delhi for previously caving to Washington's pressure to cut Russian oil imports. President Trump had imposed an additional 25 percent tariff on India over its purchases of Russian crude, and India eventually agreed to reduce imports in exchange for tariff relief.
Now that India needs Russian oil again, Moscow is extracting its price.
A New Energy Reality
Energy Secretary Chris Wright told CNN that the administration is working on short-term measures to stabilize markets, calling the waiver "no change in policy towards Russia" but rather "a very brief change in policy just to keep oil prices down."
India, which holds crude stocks covering roughly 25 days of demand, is also tapping its strategic reserves. With the discount cushion gone, analysts warn of renewed inflationary pressure on the Indian economy at a time when global energy markets remain deeply uncertain.