Russia has started importing gasoline by sea from India for the first time as it is dealing with fuel shortages caused by repeated Ukrainian drone attacks on its oil refineries. This is a reversal in the energy trade relationship, where Russia has traditionally been India’s biggest crude oil supplier.
News agency Reuters, quoting sources, reported that at least 60,000 metric tonnes of gasoline have already been shipped from India to Russia. Two tankers carrying between 30,000 and 40,000 tonnes each have been dispatched, industry sources said. Another source told Reuters that Russia plans to import around 400,000 tonnes of gasoline every month from several countries, including Belarus.
Russia has been facing fuel shortages across several regions after Ukrainian drone strikes damaged refining infrastructure. President Vladimir Putin also acknowledged that the attacks had disrupted fuel supplies in some parts of the country. To address the shortage, Russia recently approved tax changes that include subsidies for fuel imports, with the subsidy linked to Indian delivery costs and prices.
India’s Russian crude imports are at record levels
The gasoline exports come even as India continues to buy record volumes of crude oil from Russia. According to energy intelligence firm Kpler, India imported a record 4.93 million barrels per day (bpd) of crude oil in June. Around 2.6-2.7 million bpd came from Russia, accounting for more than half of India’s total crude imports during the month. Russian crude shipments increased sharply from May, when they stood at about 2.13 million bpd and made up 36.5% of India’s imports.
Kpler analyst Sumit Ritolia told PTI, “India’s crude imports have quietly demonstrated remarkable resilience over the past 100 days. Over the past 100 days, India has arguably been one of the best-positioned major importers, successfully maintaining crude inflows through proactive diversification and procurement strategies.”
He added, “India imported 4.93 million bpd of crude in June, the highest June volume on record, despite heightened geopolitical tensions in the Middle East. At the same time, Russian crude imports climbed to around 2.6 million bpd, reaffirming Russia’s position as India’s largest and most important crude supplier.”
Before the Ukraine war, Russia was a minor supplier
Russia was not always India’s biggest energy partner. According to Al Jazeera, before Russia invaded Ukraine in 2022, Russian crude accounted for only around 2.5% of India’s oil imports, while India depended largely on Gulf countries for its energy needs. India’s imports of Russian oil were worth only about $2.3 billion in 2021, according to the US Energy Information Administration.
The 2022 turning point
The relationship changed dramatically after Western sanctions reduced Russia’s access to European buyers following the Ukraine war. Moscow began offering large discounts on crude oil, making Russian barrels highly attractive for Indian refiners.
Indian Oil Corporation was among the first refiners to purchase Russian Urals crude after the war began. At the same time, India maintained a neutral diplomatic position, saying it was buying oil based on market conditions rather than politics.
Russian oil became India’s biggest import source
Russia’s share in India’s crude imports rose to 21.6% in 2022-23, increased to 35.9% in 2023-24 and remained at 35.8% in 2024-25. India’s imports of Russian crude reached $52.7 billion in 2024, averaging around 1.7 million barrels per day. By 2025, India had become Russia’s second-largest crude buyer after China. Bilateral trade also expanded sharply, rising from around $13 billion in 2021 to about $68 billion in 2024-25, driven mainly by oil, gas and fertiliser imports.
Payment problems led to alternative arrangements
Western sanctions on Russian banks complicated oil payments because many Russian financial institutions were cut off from the SWIFT banking network. India initially explored a rupee-ruble payment mechanism similar to arrangements used during the Cold War. However, because India imported far more from Russia than it exported, Russian banks accumulated large amounts of rupees that they found difficult to use. As a result, refiners increasingly shifted to payments in UAE dirhams, while India later allowed Russia to invest its rupee balances in Indian government bonds, equities and other domestic assets.
The shadow fleet kept Russian oil moving
Sanctions also forced Russia to rely on a large “shadow fleet” of ageing tankers operating under foreign flags and complex ownership structures to transport oil.
According to Kyiv Independent, this fleet now handles an estimated 65% of Russia’s seaborne oil exports. Western governments have stepped up enforcement, imposing hundreds of sanctions on these vessels and, in some cases, seizing ships linked to sanctioned oil trade.
India emerged as a major refining hub
India has also benefited by refining discounted Russian crude into petroleum products and exporting them globally. Petroleum exports from India to Europe rose significantly after the Ukraine war, leading to criticism that Russian crude was effectively reaching Western markets after being refined in India. The European Union has since tightened sanctions, including measures targeting Nayara Energy, an Indian refinery partly owned by Russian oil major Rosneft.
US sanctions and tariffs increased pressure
Pressure on India’s Russian oil purchases intensified during 2025 as the United States imposed tougher sanctions on Russian energy companies and increased tariffs on Indian goods.
Although imports slowed at times following sanctions on Rosneft and Lukoil, they never stopped completely. Rising energy demand and concerns over disruptions in West Asia encouraged Indian refiners to continue buying discounted Russian crude whenever it remained commercially attractive.
Where the relationship stands now
India continues to rely heavily on discounted Russian crude to meet its energy needs, while Russia is now turning to India for refined fuel as it deals with refinery disruptions caused by the war in Ukraine. Regardless of sanctions, payment challenges and geopolitical pressure, energy trade between the two countries remains strong and continues to adapt to changing global conditions.