Russia is sweetening the deal for India by offering deeper discounts on its Urals crude oil—between $3 and $4 per barrel—to secure continued energy trade despite growing U.S. tariffs and geopolitical tension
This move effectively counters recent U.S. efforts to curb India’s purchases of sanctioned Russian oil. President Donald Trump’s administration doubled tariffs on Indian goods—now at 50%—aiming to penalize India for indirectly supporting Russia’s war efforts. Yet, the strategy appears to be backfiring. Russia’s steeper discounts have re-enticed Indian refiners, creating a $7-per-barrel price gap compared to other crude grades, neutralizing the impact of the tariffs
India’s Prime Minister Narendra Modi has reaffirmed the country’s strong energy partnership with Russia, even as tensions with the U.S. escalate. Both leaders—Modi and Putin—expressed satisfaction with growing economic and energy collaboration during a recent meeting.Financial Times
Why It Matters
| Key Factor | Insight |
|---|---|
| Cost Advantage | Discounts of $3–4 per barrel make Urals crude outfit enticing amid global price volatility. |
| Geopolitical Tensions | U.S. tariffs aimed at deterring purchases have failed: the financial appeal of Urals crude remains too strong |
| Strategic Energy Relationship | Modi’s reaffirmation of ties with Putin underscores the long-term strength of India–Russia energy cooperation. |
