THE US has temporarily eased economic sanctions against Russia to allow millions of barrels of stranded Russian crude oil to be sold to India, in an unusual move driven by mounting energy supply concerns triggered by the escalating conflict in the Middle East.
The US Treasury Department's Office of Foreign Assets Control issued a 30-day licence on Thursday (5) authorising the delivery and sale of Russian crude and petroleum products already loaded onto vessels as of March 5, 2026. The waiver covers transactions involving ships blocked under various sanctions regimes and remains in effect until April 3.
Treasury secretary Scott Bessent framed the move as a pragmatic stopgap rather than a softening of Washington's stance on Moscow.
"This deliberately short-term measure will not provide significant financial benefit to the Russian government as it only authorises transactions involving oil already stranded at sea," he said, adding that the waiver was designed to "alleviate pressure caused by Iran's attempt to take global energy hostage."
According to sources, Indian refinershad already begun purchasing cargoes from the more than 15 million barrels of Russian crude floating in vessels near the country, with over a dozen tankers idling in the Arabian Sea and the Bay of Bengal.
A further eight vessels off Singapore could reach Indian ports within days, sources said, and additional ships in the Mediterranean and Suez Canal would arrive within a month.
The waiver comes at a critical moment for India's energy security. The country sources between 40 and 50 per cent of its crude oil needs from the Middle East through the Strait of Hormuz — a route now effectively closed by the widening West Asia conflict. India holds domestic inventories covering just 25 days of demand, leaving refiners with little margin for disruption.
India had significantly curtailed its purchases of Russian crude in recent months following sustained US pressure to reduce financial flows to Moscow. Imports fell to 1.04 million barrels per day in February, the lowest since November 2022, after Washington made tariff concessions on Indian goods contingent on New Delhi reducing its Russian purchases. That sharp pullback left numerous tankers carrying Russian oil adrift on the high seas with no buyer.
Analysts say the waiver could push Russian crude inflows to India back up towards 1.6 to 2 million barrels per day in the near term. "The US waiver allowing additional purchases of Russian crude offers short-term relief," said Sumit Ritolia of data intelligence firm Kpler, though he cautioned that competition from Chinese buyers for the same cargoes could limit India's gains.
Washington, meanwhile, is clear-eyed about the longer-term picture. Bessent said the US fully expects India to ramp up purchases of American oil, describing New Delhi as "an essential partner."
(Agencies)
