US Grants Indian Refiners Temporary Waiver for Russian Oil Amid Middle East Tensions

US Provides 30-Day Waiver for Russian Oil Purchases

On Thursday, the United States issued a temporary 30-day waiver allowing Indian refiners to acquire Russian oil that is currently stranded at sea due to ongoing conflicts in West Asia.

According to US Treasury Secretary Scott Bessent, this decision serves as a short-term solution to maintain global oil supply amidst disruptions caused by the conflict.

Bessent emphasized that this measure is unlikely to yield significant financial gains for the Russian government, as it only allows for the trade of oil that is already stranded.

The announcement comes in response to rising crude oil prices and concerns over supply disruptions from West Asia.

"India is a vital partner for the United States, and we expect New Delhi to increase its purchases of US oil," Bessent stated on social media. He added that this temporary measure would help alleviate the pressure from Iran's attempts to manipulate global energy supplies.

India relies heavily on imports for its energy needs, with approximately 80% to 85% of its oil and gas requirements being met through foreign sources.

As of Friday, the price of benchmark Brent crude had surged to $84 per barrel following a joint operation by Israel and the US on February 28 aimed at degrading Iran's capabilities.

This military action occurred amid escalating tensions regarding Tehran's nuclear program, with Washington acting as a guarantor of Israel's security. Israel has expressed concerns that Iran is nearing the capability to develop a nuclear weapon, which could destabilize the regional security landscape.

In response, Iran has targeted Israeli and US military bases in the region, as well as major cities in other Gulf nations.

On Monday, Iranian officials claimed that the Strait of Hormuz was effectively closed to shipping traffic, threatening to set ablaze any vessels attempting to navigate through this crucial waterway.

To address concerns regarding oil access, US President Donald Trump announced on Tuesday that he had instructed the International Development Finance Corporation to offer political risk insurance and financial guarantees for maritime trade in the Gulf.

Trump also mentioned that the US Navy would escort oil tankers through the Strait of Hormuz, a vital maritime route that connects the Gulf to the Arabian Sea, through which about 20% of global petroleum liquids consumption passes.

Earlier, on February 7, Trump had signed an executive order lifting a 25% punitive tariff on Indian imports related to Russian oil purchases, reducing the effective US tariff rate on Indian goods to 18% following an interim trade agreement.

While the US has accused India of supporting the war in Ukraine through its Russian oil purchases, New Delhi has consistently argued that its actions are focused on securing its own energy needs.