India Faces Potential $3.7B Annual Cost to Replace Russian Oil

India's reliance on Russian oil could come at a steep cost if it needs to replace 1 million barrels per day (bpd) of Russian crude imports with more expensive alternatives. According to Financial Express, this would add up to $3.7 billion a year in costs for India. The price differential is estimated to be between $5-10 a barrel.

Natalia Katona, a UAE-based freelance commodity analyst, noted that replacing around 2 million bpd could broadly double the impact. However, she emphasized that this is a sensitivity calculation rather than a forecast of the current price differential.

Russia supplied India with around 1.9 million bdp in August, accounting for about 42% of its crude imports. Indian authorities have prioritized energy security and national interests, suggesting that any change in sourcing would likely involve diversification rather than a sharp retreat from Russian crude.