In one version of this tale, India received permission covertly, made the most of it, and then just continued after it expired. In essence, that is what took place. Following the disruption of Middle Eastern supplies following the Iran war, the US Treasury issued a temporary waiver in March 2026 that permits Indian buyers to continue purchasing Russian seaborne crude without incurring secondary sanctions. This carve-out was publicly presented as a stabilization measure. From the outside, it appeared as though Washington was giving New Delhi a diplomatic buffer in the hopes that Modi would follow through.
India was importing Russian crude at a never-before-seen rate by the first two weeks of May—2.3 million barrels per day—a figure that suggests acceleration rather than caution. Refiners hurried to load cargoes while they still had cover, presumably knowing that the waiver was about to expire on May 16. It is anticipated that full-month flows will be near record levels, averaging about 1.9 million barrels per day. In actuality, the waiver had the opposite effect of what it was intended to moderate. There was no taper in India. It accumulated.
The directness of India’s response when the waiver eventually expired without renewal was almost shocking. Reporters were informed by Sujata Sharma, a joint secretary in the Petroleum Ministry, that the nation had been purchasing Russian oil prior to, during, and following the waiver. “Whatever waiver or no waiver,” she replied, “it will not affect.” A government official dismissing a US sanctions mechanism so bluntly is uncommon. Delhi seems to have calculated—possibly correctly—that Washington’s influence in this situation is more constrained than it seems.
The Iran War’s role in completely changing the equation contributes to the complexity of this story. Refiners were forced to look for alternatives as the supply of Middle Eastern crude to India fell by 61% in March compared to February. Russia, which has been India’s main supplier since 2022, nearly instantly doubled its deliveries. Once arriving at a steep discount, the oil now comes at a premium because Russia has subtly reversed the terms of trade while sitting on a captive buyer base with limited options. India is spending more. The math of energy security still favors Russia, at least for the time being, so it is purchasing anyhow.
Even though it appears that way from Washington, what Modi is doing here is not reckless. In a nation where power outages have immediate political repercussions, this kind of trade-off makes more sense. It is a calculated exposure to geopolitical risk made in exchange for energy reliability. India’s stance has always been to prioritize its customers over alliance politics. Although it is more difficult to maintain as the premium for oil prices increases, that argument is not irrational. As this develops, it’s difficult to ignore the fact that India’s influence in this relationship stems from its size and importance, which makes it difficult to punish.
In October of last year, Trump asserted that Modi had personally promised him that India would soon cease purchasing Russian oil. Delhi claimed not to be aware of any such discussions taking place. Almost everything about the two nations’ true positions can be inferred from the diplomatic divide between what the US president said and what the Indian government acknowledged. The waiver is no longer in effect. The oil continues to flow. For the time being, the wager is still open.
