The ongoing war in the Middle East is leading to a looming global oil crisis, prompting India to acquire crude oil from Russia at elevated prices. Although the US has granted India a 30-day waiver to purchase oil from Russia, the Indian government may face increased costs as traders are reportedly selling Russian Urals crude oil at a premium of $4-5 per barrel compared to Brent crude. It is expected that this oil will arrive at Indian ports in March and early April, which will be at a higher cost than earlier purchases made before the conflict.

Earlier, in February, Indian companies benefited from a $13 discount on Russian crude oil, with Hindustan Petroleum Corporation Limited (HPCL) purchasing two cargoes on the 28th of February right before the war started. However, the current situation has changed drastically, leading to a disruptive supply in oil due to the ongoing conflicts in the Middle East. With reduced supply, Indian refiners are making significant purchases of millions of barrels of crude oil from Russia to secure immediate supplies amidst this disruption.

The purchasing companies include major Indian public sector refiners such as Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation. With these continued acquisitions at elevated prices, the Indian oil market faces challenges that could affect domestic prices and supply stability, raising concerns about energy security as global tensions continue to impact oil availability.