Amid US tariff threat, IOC orders 2 million barrels of American crude for October

Indian Oil Corporation (IOC), the country’s largest oil company, placed orders for around 2 million barrels of US crude in August for delivery in October, according to a Reuters report from Singapore, according to an IANS report.

This marks part of a series of US oil deals amounting to around 2 million barrels for October delivery, following threats from US President Donald Trump to impose additional tariffs on Indian exports.

Russian oil flows remain strong

Despite the increase in US purchases, India continued to import about 2 million barrels per day of Russian crude in August, based on orders placed in June and July. The higher Russian inflows came at the expense of imports from Iraq and Saudi Arabia, energy tracker Kpler noted.

India has maintained that its Russian oil purchases remain within the G7 price cap and are not subject to sanctions. Officials argue that such imports align with US policy, which seeks to keep oil prices in check globally while limiting Moscow’s revenue.

Rising US energy imports

Official trade data shows India’s oil and gas imports from the US jumped 51 per cent between January and June this year. Liquefied natural gas (LNG) imports from the US nearly doubled to $2.46 billion in FY 2024-25 from $1.41 billion the previous year.

In February, Prime Minister Narendra Modi pledged to raise India’s US energy imports to $25 billion in 2025 from $15 billion in 2024 to help narrow America’s trade deficit. Following this commitment, state-owned oil and gas firms have entered discussions for more long-term US energy supply agreements.

Strategic ties beyond trade

New Delhi has underscored that it is diversifying its energy sources to reduce dependence on Russian supplies. The government has also reiterated that India-US relations extend well beyond trade, encompassing significant geopolitical and strategic dimensions.

Officials told the Parliamentary Standing Committee on External Affairs that there is no change in plans for the sixth round of India-US trade talks, which could pave the way for a future trade agreement.