The United States has allowed India to purchase Russian oil that is already on ships at sea, aiming to ease global supply pressures during the ongoing conflict with Iran.
The US said it has “allowed” India to buy Russian oil, which is already on vessels floating in the waterways. This is aimed at easing global supply amid the West Asian conflict.
US Treasury Secretary Scott Bessant said in an interview with Fox Business on Friday, “The world’s oil supply is very good.” Yesterday, the Treasury (Department) agreed that our partners in India will start buying Russian oil, which was already on the water.”
He added, “The Indians have done a great job. We asked them this fall to stop buying Russian oil that was banned. They did so. They were going to replace it with US oil. But to alleviate the temporary global oil shortage, we have allowed them to buy Russian oil. We may also sanction other Russian oil.”
Bessant said there are billions of barrels of crude oil in the water, and in fact, “by unsanctioning them, the Treasury can create supply.” “And we’re paying attention to that. We’ll continue to take steps to provide relief to the market during this fight.”
Several other Trump administration officials are also saying that the US has now allowed India to buy oil from Russia, even though President Donald Trump imposed a 25% punitive tariff on Delhi for purchasing oil from Moscow just a few months ago.
Energy Secretary Chris Wright said in a post on Friday that the US is allowing “our friends in India” to transport Russian oil already on ships to South Asia, refine it, and bring the stocks to market quickly to maintain supply and ease pressure amid the ongoing US-Israeli war against Iran.
Wright said, “We have implemented short-term measures to help keep oil prices low. We are allowing our friends in India to take oil already on ships, refine it, and bring those barrels to market quickly. This is a practical way to keep supplies flowing and ease pressure.”
In an interview with ABC News Live, Wright said that long-term oil supplies are “plenty” and there’s no cause for concern, but in the short term, oil needs to be brought to market.
“But as soon as the price of oil rises a little bit due to disruptions in the Strait of Hormuz, we’re taking a short-term action to say that all the Russian oil stored around South Asia belongs to China. China doesn’t treat its suppliers well, so there are a lot of barrels of oil sitting there.
“We’ve talked to our friends in India and said, ‘Buy that oil. Bring it to your refineries.'” “This gets the stored oil immediately into Indian refineries and takes the pressure off other refineries around the world to buy oil, so they’re no longer competing with Indian refineries in that marketplace,” Wright said.
He added, “So we have a number of measures that are short-term and temporary. This isn’t a policy change toward Russia. It’s a very small policy change to keep oil prices as low as we can.”
On Thursday, amid the escalating dispute with Iran, the US announced it was granting a temporary 30-day waiver to allow Indian refineries to purchase Russian oil.
Besant said, “Due to President Trump’s energy agenda, oil and gas production has reached an all-time high. To keep oil flowing to the global market, the Treasury Department is granting a temporary 30-day waiver to allow Indian refiners to purchase Russian oil.”
He added that this “deliberately short-term measure” would not provide any significant financial benefit to the Russian government, as it only approves transactions involving oil already stranded at sea. “India is an essential partner for the United States, and we fully expect New Delhi to increase its oil purchases from the United States,” Bessant said. ” This ad-hoc step will ease the pressure created by Iran’s attempt to hold the global energy system hostage.”
Trump had imposed a punitive 25% tariff on India for purchasing Russian oil, and the administration said Delhi’s purchases were helping fuel Russia’s war machine against Ukraine.