The game of oil purchase between America, Russia, Iran and China is now becoming a big lesson for India. Experts say that India is buying expensive American oil, while China is strengthening its energy security by taking discounted oil from Russia and Iran. China’s economy is benefiting from this strategy and India is entangling itself in expensive options.
Buying expensive American oil instead of cheap oil from Iran
Strategic affairs expert Brahma Chellaney wrote on X that the Trump administration is pressurizing India to stop buying Russian oil and instead buy more expensive American crude. He said that similar pressure was successful during Trump’s first term also, due to which India had almost stopped buying oil from Iran. At that time Iran used to provide subsidized oil, but due to American pressure, India became a major supplier to the US. Now the same pattern is being repeated.
According to Chellani, India is increasing its purchase of American oil and petroleum products in the name of ‘import diversification’. As Commerce Minister Piyush Goyal has also admitted. But American oil, including shipping costs, is more expensive than oil from the Middle East. This decision seems to be more political than economic.
What harm will this decision of India cause?
Its biggest disadvantage is that India is buying less oil from Russia and Iran, due to which China is buying the world’s cheapest crude oil almost exclusively. Oil from Russia and Iran is available at a huge discount from the Brent benchmark. Sometimes up to 9-11 dollars per barrel. This is strengthening China’s energy security, while India is reducing its competitiveness by paying higher prices.
Chellani wrote, ‘India’s decision to block Iranian oil made China an almost exclusive buyer of the world’s cheapest crude. New Delhi is once again underwriting China’s economic power. He said that India’s silence is making this game easier.
India is the world’s third largest oil buyer
The share of Russian oil is expected to decline to 33-35% in 2025-26, while the share of American oil is increasing. Before Russia, India used to get 1.8-2 million barrels per day, now it has reduced to 1.1-1.2 million. Meanwhile, China is buying record amounts of oil from Russia. More than 2 million barrels per day in February 2026.
Trump had recently claimed to stop Russian oil from the trade deal with India and America removed the 25% penalty tariff imposed on India. But India never officially agreed to stop oil from Russia. Nevertheless, pressure and sanctions are reducing the discount on Russian oil and India is having to look for alternative sources (such as Venezuela).
Does India need to worry?
This situation is of concern for India, because both energy security and economy are being affected. Experts say that India should keep its energy policy away from political pressure, otherwise rivals like China will continue to take advantage. Now it has to be seen whether India will be able to come out of this pressure, or will it continue to pay the price of expensive oil?
