India may face a sharp rise in its oil import costs—up to $14 billion—if it stops buying Russian crude oil due to U.S. pressure. Former U.S. President Donald Trump has already imposed a 25% tariff on Indian exports and warned of further penalties for India’s ongoing trade with Russia, especially its continued purchase of discounted Russian oil.
India’s Oil Savings Could Vanish
Since Russia began its war in Ukraine in 2022, India has been purchasing crude oil from Russia at discounted rates. These low-cost imports helped India save nearly $17.2 billion between May 2022 and 2025, according to ICRA’s data. But that financial benefit may soon disappear.
Replacing Russian Oil Will Cost More
If India gives in to the pressure and stops importing Russian oil, it could drive up global oil prices by as much as $10 per barrel. This would directly push India’s annual oil import bill higher by $13 to $14 billion, says Prashant Vasisht, Senior Vice President and Co-Group Head of Corporate Ratings at ICRA.
Gas and LNG to Get Expensive Too
But the rising cost may not stop at crude oil. Vasisht warns that prices for gas, liquefied natural gas (LNG), and other petroleum-based products will also climb. He explains, “Additionally, domestic gas and LNG imports linked to dated Brent prices would also become dearer thereby impacting all gas consumers such as fertiliser, city gas distribution etc.” He estimates that even a $10-per-barrel increase in Brent crude could raise the cost of LNG under India’s RasGas contract by ₹3,900 crore each year.
Global Markets Will Feel the Ripple Effect
India’s move away from Russian oil wouldn’t just hurt its own economy—it would also affect global markets. Together with China, India has been absorbing Russia’s oil oversupply, helping to ease pressure on global oil prices. If India exits the Russian oil market, demand for non-Russian oil will rise, pushing prices up worldwide.
Western Nations May Also Suffer
India’s exit from Russian oil deals under U.S. pressure could raise global oil prices and cost India an additional $14 billion in imports. The impact will also reach Western countries. As oil prices climb due to reduced availability of Russian supplies, they will have to pay more. Moreover, since 2022, India has been refining Russian crude and exporting the final products to Western nations at lower prices. If those discounted supplies stop, the cost of finished fuel for the West will also rise.
