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India’s state oil giant has turned to Nigerian and Middle Eastern supplies in its latest crude purchases, bypassing the United States as trade tensions with Washington escalate.
According to trading sources quoted by Reuters, the Indian Oil Corporation (IOC) skipped US crude in its latest tender, instead buying two million barrels from Nigeria and another one million barrels of Abu Dhabi’s Das grade from Shell. The Nigerian cargoes — one million barrels each of Agbami and Usan grades — were sourced from TotalEnergies.
The barrels are expected to arrive at Indian ports between late October and early November. This marks a sharp departure from IOC’s previous tender, in which it purchased five million barrels of US West Texas Intermediate (WTI).
Nigeria has recently boosted its crude production to above 1.7 million barrels per day (bpd) for the first time in seven months — a 16.6 per cent rebound from September 2024 levels. Officials at the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) attribute the recovery to tighter security measures in the Niger Delta, which have cut oil theft from as much as 300,000 bpd to fewer than 5,000 bpd.
Rig activity has also surged, with 46 rigs active compared to just eight in 2021. International oil companies are renewing interest, particularly in deepwater production. Given that crude exports account for about two-thirds of Nigeria’s government revenue and more than 80 per cent of its foreign exchange inflows, the uptick offers hope of easing fiscal pressures, strengthening reserves, and stabilising the naira.
For India, the move comes amid a broader recalibration of its energy imports. New Delhi has taken advantage of discounted Russian oil since 2022, becoming Moscow’s biggest seaborne customer after Europe and the US imposed sanctions over the Ukraine war. But this policy has deepened frictions with Washington.
Former US president Donald Trump, who has returned to office, recently imposed a 50 per cent tariff on Indian goods, accusing New Delhi of “funding Moscow’s war effort” through its oil purchases. US Treasury Secretary Scott
Bessent has also accused India of profiteering by reselling refined fuels from discounted Russian crude at higher prices.
Despite the pressure, India has signalled it will not scale back Russian imports. Finance Minister Nirmala Sitharaman told CNN-News18 that India, the world’s third-largest oil importer, will continue to “buy from the place which suits our needs — whether in terms of rates or logistics.”
“Whether it is Russian oil or anything else, it’s our decision,” she said. “We spend most of our foreign exchange on crude oil and refined fuels. We will undoubtedly be buying it.”
Washington, meanwhile, has urged New Delhi to resume trade talks and align more closely with US policy. US Commerce Secretary Howard Lutnick said Friday: “We’re always willing to talk… We are the consumers of the world.”
In the fiscal year to March 2025, crude oil and refined fuels made up about a quarter of India’s overall imports, underscoring how central energy is to both its trade profile and its foreign policy balancing act.
