The United States has issued a temporary 30-day waiver allowing India to purchase Russian oil that is currently stranded at sea, in a bid to maintain global oil supplies and prevent further price increases amid the escalating Middle East conflict.
The US Treasury Department announced the waiver on Thursday, with Treasury Secretary Scott Bessent describing it as a “stopgap measure” to alleviate pressure caused by Iran’s attempt to “take global energy hostage”. The move comes after the US imposed heavy sanctions on Russia over its invasion of Ukraine, and follows President Donald Trump’s imposition of a 25% tariff on Indian imports in August over New Delhi’s continued purchase of cheap Russian oil.
Bessent stressed that the waiver is deliberately short-term and will not provide significant financial benefit to Russia, as it only authorises transactions involving oil already stuck at sea. He added that he expects India to eventually buy more US oil. Meanwhile, Kremlin spokesperson Dmitry Peskov noted that the war in Iran has fuelled demand for Russian energy products.
The waiver comes as Iran’s effective blockade of the Strait of Hormuz, following US and Israeli strikes last weekend, has sparked fears of global energy shortages. Qatar’s energy minister warned on Friday that the escalating conflict could “bring down the economies of the world” by causing a surge in energy costs, potentially driving oil to $150 a barrel. Kuwait has reportedly begun cutting production at some oilfields, pushing oil prices above $90 a barrel.
Indian refiners are buying millions of barrels of Russian crude to navigate the supply crunch. State-owned firms such as Indian Oil, Bharat Petroleum, Hindustan Petroleum, and Mangalore Refinery and Petrochemicals are reportedly in talks with traders for prompt delivery of Russian cargoes. India is particularly vulnerable to supply shocks, with crude stocks covering only about 25 days of demand and around 40% of its oil imports coming from the Middle East via the Strait of Hormuz.
The decision has drawn criticism from Global Witness, which accused the White House of helping to “fuel Putin’s war machine” and sacrificing the people of Ukraine to combat an oil price crisis triggered by the US and Israel. The International Energy Agency’s executive director, Fatih Birol, also warned against turning back to Russia for gas supplies, calling Europe’s overreliance on Russian energy a “historical mistake”.
