This photo shows a page from the Marinetraffic website showing commercial ship traffic on the edge of the Strait of Hormuz, near the Iranian coast, on March 4, 2026.
Julian De Rosa | afp | fake images
After imposing 25% “penalty” tariffs on India for buying Russian crude (revoked last month), the United States on Thursday issued a 30-day waiver to New Delhi to buy crude from Moscow, as the war with Iran threatens global energy supply shocks.
West Texas Intermediate crude oil rose 8.51%, or $6.35, to close at $81.01 a barrel on Thursday, the biggest one-day gain since May 2020. Global benchmark Brent rose 4.93%, or $4.01, to close at $85.41 a barrel.
The exemption on the purchase of Russian oil will help ease global supply concerns as India is the world’s fourth-largest refiner and fifth-largest exporter of petroleum products.
India, the world’s third-largest oil importer, has been replacing Russian oil purchases with supplies from the Middle East, experts said, but as the conflict affects energy supplies from Gulf countries, New Delhi is starting to source energy from Moscow.
“I have heard that Indian refiners have been actively seeking quick supplies of Russian crude oil since last weekend,” said Muyu Xu, senior crude oil research analyst at energy data tracker Kpler, adding that based on “market rumours”, New Delhi has likely bought between 6 million and 8 million barrels of Russian oil in the last 2-3 days.
This “short-term measure will not provide a significant financial benefit” to Russia, as it only allows transactions for oil already stranded at sea, said US Treasury Secretary Scott Bessant in a post on X.
The US government is taking steps to curb rising oil prices, including offering political risk insurance for oil tankers transiting the Gulf.
“(The waiver) is a relief valve, given the loss of nearly 20 million barrels per day of crude oil from Gulf producers,” said Vandana Hari, chief executive of energy research firm Vanda Insights, adding that the 30-day waiver “is not enough” and Washington continues to put “Band-Aids on a bullet wound.”
US crude oil prices have risen around 20% this week due to the escalating conflict in the Middle East.
“Further steps to reduce pressure on oil are imminent and… in the long term, the steps we are taking will dramatically increase the stability of the region and oil prices,” US President Donald Trump said on Thursday.
Traffic in the Strait of Hormuz, the waterway used by 20% of global oil flows, remains stalled following Iranian warnings and rising insurance costs for shippers.
““Our data shows that no crude oil tankers have transited the Strait of Hormuz since last weekend, including vessels that may be destined for India,” Xu said.
Impact on India
India currently has “access to about 100 million barrels,” enough to cover up to 45 days of crude demand, Prateek Pandey, head of APAC oil and gas research at energy intelligence firm Rystad Energy, told CNBC’s “Inside India” on Thursday.
Pandey said Indian refineries will not be affected for the next three to four weeks., but “there will be concerns” if the disruption in the Middle East continues beyond that.
Sourcing from alternative destinations like Venezuela poses challenges as these shipments take almost a month to reach India, he said.
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In August last year, India was hit with 50% US tariffs, including 25% as punishment for buying Russian oil. Last month, the sanction was removed on condition that India reduce imports from Moscow and buy more American energy supplies. Washington warned it could reinstate the penalty if India resumed purchasing Russian oil.
“I have not seen any increase in US crude arrivals to India yet,” Xu said, adding that any increase in US oil purchases by New Delhi following the trade deal will be reflected in April or May data.
