US Greenlights India’s Russian Oil Purchases as Iran Conflict Shakes Global Supply Chains
Washington gives Delhi a strategic nod—just as Middle East tensions threaten to squeeze the world's energy arteries.
The Geopolitical Pivot
Forget sanctions talk. The US just handed India a free pass on Russian crude. The timing isn't coincidental. Conflict in Iran is disrupting flows, sending traditional buyers scrambling. This isn't about diplomacy; it's about keeping the global tankers moving when a major artery gets pinched.
The Supply Chain Calculus
Markets hate uncertainty, and nothing spells uncertainty like a flare-up in the Strait of Hormuz. With Iran-linked disruptions, every barrel from Russia that India takes is one less barrel fighting for alternate routes. The green light from the US simply acknowledges a brutal reality: in a supply crunch, old rules get parked. It's a pragmatic bypass of the very sanctions Washington once championed.
The Ripple Effect
This move does more than secure India's supply. It recalibrates global oil politics in real-time. It signals to other nations that in a pinch, exceptions become the rule. Watch for other large consumers to seek similar, quiet understandings. The market's response? A collective shrug—because when physical barrels are at stake, paper promises tend to get renegotiated. Another win for realpolitik over portfolio theory.
So while energy traders adjust their models and compliance officers draft new memos, the oil keeps flowing on new, approved detours. Another reminder that in global finance, the only true hedge is against your own government's next policy reversal.
Washington permits India to accept oil from Russia
The U.S. government has issued a temporary license to India to buy Russian oil against the backdrop of an escalating war with Iran that has already bumped prices.
Secretary of the Treasury Scott Bessent confirmed reports that his department has granted New Delhi a 30-day waiver that applies to Russian oil carried by tankers currently at sea.
On Thursday, he took to X to provide the motives for the move, emphasizing its main purpose is to allow oil to keep flowing into the global market.
Bessent noted that Moscow won’t be able to significantly benefit due to the limited timeframe and scope of the U.S. permit.
The latter covers only oil and products already stranded at sea, which were loaded on vessels before or on March 5, as evident from the license published by the Office of Foreign Assets Control (OFAC).
The secretary described it as a “stop-gap measure” meant to “alleviate pressure caused by Iran’s attempt to take global energy hostage.”
Scott Bessent also expressed hope that India, which he called “an essential partner,” will increase oil purchases from the United States as well.
President Trump’s energy agenda has resulted in oil and gas production reaching the highest levels ever recorded.
To enable oil to keep flowing into the global market, the Treasury Department is issuing a temporary 30-day waiver to allow Indian refiners to purchase Russian oil.…
— Treasury Secretary Scott Bessent (@SecScottBessent) March 6, 2026
The U.S. and Israel began massive, coordinated strikes against Iran on the last day of February, targeting its political and religious leadership as well as military commanders and sites, with the stated goals of preventing it from acquiring a nuclear weapon and bringing a regime change to Tehran.
The Islamic Republic responded by launching missiles and drones against Israel and U.S. interests, military bases and allies in the Persian Gulf region.
The conflict disrupted maritime traffic in the Strait of Hormuz, which accounts for the transit of approximately 20% of global oil supplies, causing prices of Brent crude to rise above $80 per barrel.
On Thursday, Iran’s Islamic Revolutionary Guard Corps (IRGC) said the strait was closed only to vessels linked to the U.S., Israel, Europe, and their Western allies.
A day earlier, the branch revealed it had hit more than 10 ships, including oil tankers, since the beginning of the hostilities, while permitting the passage of “two ships of friendly countries.”
Trump vows further action to halt oil price rises
Meanwhile, President Donald Trump unveiled the U.S. government is planning to take additional measures to curb growth in oil prices. Speaking at a White House event, he stated:
“Further action to reduce pressure on oil is imminent, and the oil seems to have pretty much stabilized.”
He highlighted the offering of political risk insurance for oil tankers transiting into the Gulf. Earlier this week, Trump announced that U.S. warships will escort tankers in the Strait of Hormuz if that’s necessary.
Russian oil supplies to India may return to previous levels
India took advantage of Russian oil at discounted rates amid Western sanctions on Moscow over its invasion of Ukraine.
However, it later found itself under U.S. pressure to limit these purchases, with the Trump administration slapping tariffs on Indian imports, eased under a recent trade deal.
Amid the current Middle East crisis, Russian oil deliveries to India may reach 1.5 million barrels per day, an expert quoted by the TASS news agency predicted earlier this week.
According to Maxim Malkov, partner at Kept and head of the consulting firm’s oil and gas services, this means a return to the highest figures registered in the 2024 – 2025 period.
His comments came after Russian Deputy Prime Minister Alexander Novak unveiled that Moscow was seeing an increased Indian demand for its oil.
Sergey Kaufman, analyst at the Russian financial group Finam, added that if the conflict with Iran protracts, the U.S. may allow more Russian oil into India and the global market to avoid price spikes.
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