Niti Shastra | Navroop Singh, Himja Parekh
India has emerged as the pivotal battleground in global crude oil trade, with Russia, the United States, Saudi Arabia, and a newly independent United Arab Emirates fiercely competing for dominance. India's oil import dependence, at 88.6 percent and rising, positions it as the world's premier oil demand driver, projected to increase from 5.5 million barrels per day in 2023 to 6.6-6.7 million barrels per day by 2030. Following the February 2022 Ukraine invasion, Russia's share in India's crude imports skyrocketed from 2 percent to approximately 40 percent by mid-2025, reaching $52.73 billion in 2024 sales. This was largely facilitated by the non-dollar Rupee-Rouble "Delhi Loop" settlement mechanism, enabling payments in rupees via Special Rupee Vostro Accounts, bypassing Western sanctions. A February 2026 India-U.S. trade deal included India's pledge to purchase $500 billion worth of U.S. energy and other commodities over five years, aiming to scale U.S. crude and LNG volumes. Despite U.S. pressure, India maintained strategic autonomy, with Russian crude imports surging to 70 million barrels in March 2026 and 2.3 million barrels per day in May mid-2026 after the Iran war and Hormuz closure. The U.S. aims to make India a captive buyer, similar to Europe's reliance on American LNG. India must continue leveraging the Delhi Loop for energy security while diversifying suppliers.
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