On Russian oil, India and China speak the same language to Trump

Time of India

2 days ago

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China's framing
India's tone: Different pitch, same tune
From marginal to essential
Oil keeps flowing
The oil wildcard
Sanctions hit, but not hard enough
Enter Trump
BRICS and the Global South
Parallel defiance
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When the United States demanded that China and India stop buying Russian oil, it likely didn't anticipate triggering a geopolitical alignment between two long-time rivals.But that's what's unfolding. While far from coordinated, and certainly not allies, Beijing and New Delhi are responding in strikingly similar fashion: with defiance.Facing mounting pressure from the Trump administration to cut off what Washington calls 'Putin's war machine,' both countries are choosing energy security over compliance.As two of the world's largest oil importers, India and China wield enormous influence over global crude demand. That clout is now under direct threat.Trump has warned of imposing tariffs of up to 100% on countries that continue purchasing Russian oil, unless Moscow agrees to a peace deal with Ukraine by August 7–9. To complicate things further, a new bipartisan bill in the US Senate is calling for a 500% tariff on goods from countries that keep buying Russian oil and gas while refusing to back Ukraine.Called the Sanctioning Russia Act of 2025, the bill has been introduced by Senators Lindsey Graham (Republican) and Richard Blumenthal (Democrat), with support from over 80 co-sponsors across party lines, enough to potentially override a presidential veto.The proposed law would slap steep tariffs, up to 500%, on imports from countries that continue buying Russian crude, gas, petroleum products, or uranium and don't actively support Ukraine.Additionally, on Monday, Trump said he will be "substantially" raising the tariff paid by India to America, accusing the country of buying massive amounts of Russian oil and selling it for big profits."India is not only buying massive amounts of Russian Oil, they are then, for much of the Oil purchased, selling it on the Open Market for big profits. They don't care how many people in Ukraine are being killed by the Russian War Machine. Because of this, I will be substantially raising the Tariff paid by India to the USA. Thank you for your attention to this matter!!!"Following two days of high-stakes trade talks in Stockholm, China made its position unambiguous. On X, the Foreign Ministry wrote: 'China will always ensure its energy supply in ways that serve our national interests... Coercion and pressuring will not achieve anything.'The message wasn't just for Washington, it was for the Global South, where many governments share China's resentment of what they see as unilateral American sanctions and demands. By framing its energy choices as a matter of sovereignty, China positioned itself not as Russia's backer but as a nation defending its right to self-determination.US Treasury Secretary Scott Bessent, reflecting after the talks, acknowledged China's posture with a mix of frustration and resignation.'The Chinese take their sovereignty very seriously… We don't want to impede on their sovereignty, so they would like to pay a 100% tariff,' Bessent told reporters after wrapping up two days of US-China trade talks in Stockholm, as per Reuters.That last part, analysts believe, is pure brinkmanship. Talking to Reuters, Gabriel Wildau of Teneo called the tariff threat 'a move that would derail all the recent progress.'As Scott Kennedy of the Center for Strategic and International Studies noted, Beijing is playing a long game, waiting out Washington's bluster, leaning on ambiguity, and sticking to its strategic relationship with Moscow.China's imports from Russia reflect that approach. In April 2025 alone, oil shipments from Russia to China surged 20%, crossing 1.3 million barrels per day. China is also Iran's largest oil customer, purchasing up to 90% of Tehran's exports, according to US Energy Information Administration data.Across the Himalayas, India's tone is different, but the message is the same.Prime Minister Narendra Modi has framed India's refusal to halt Russian oil imports as an assertion of economic independence.At a rally in Uttar Pradesh, he said, 'Now, whatever we buy, there should be only one scale: we will buy those things which have been made by the sweat of an Indian.'The line plays directly into his government's 'Atmanirbhar Bharat' (self-reliant India) campaign, but it also doubles as a message to Washington - don't interfere.India has been under pressure since Trump imposed a 25% tariff on Indian exports and hinted at further penalties if oil purchases from Russia continued.However, state and private refiners are still sourcing Russian crude, and there's been no official instruction to change course.As per Reuters, Foreign Ministry spokesperson Randhir Jaiswal reinforced this stance. 'Our bilateral relationships with various countries stand on their own merit and should not be seen from the prism of a third country,' he said.India, the world's third-largest oil importer, has become the biggest buyer of Russian crude since 2022, snapping up as much as 2 million barrels per day, roughly 2% of global supply. Other major buyers include China and Turkey.The shift began in 2022, when India started ramping up its purchases of Russian oil, stepping into a void left by Europe, which had previously been Russia's top customer before banning most of its oil in response to the Ukraine war.Russia, the world's second-largest oil exporter, redirected volumes to Asia, and India quickly became a key destination. Its energy ties with Moscow have deepened, with Rosneft holding a major stake in one of India's largest refineries.According to official data, India now depends on Russian oil for 35% of its total crude needs, worth $50.2 billion in FY2024–25. Imports from Russia have surged from negligible levels in early 2022 to nearly a third of India's overall oil imports in 2025, making it the largest buyer of Russian seaborne crude.India purchases a wide range of Russian crude grades, including Urals from Western ports, ESPO and Sokol from the Pacific, and even Arctic grades, as per LSEG data.If India cuts back, urals crude would bear the brunt. India currently accounts for up to 70% of Russia's exports of that grade. While India's oil minister has said the country can secure alternative supply if needed, analysts warn of short-term disruptions.'Indian refiners will still struggle to replace the heavy quality of Russian crude, so they may end up paring runs,' Neil Crosby of Sparta Commodities told Reuters.For India, this isn't about siding with Moscow; it's about securing affordable fuel and shielding its economy from inflation shocks.Despite sweeping Western sanctions, Russia has kept its oil flowing since 2022, albeit at discounted rates compared to global benchmarks.A sharp drop in global crude prices is already hitting Moscow's wallet. According to its finance ministry, oil and gas revenues in June fell 33.7% year-on-year to their lowest since January 2023. Reuters estimates show a deeper 37% plunge in July, driven by softer prices and a stronger rouble.Traders say if Russia loses 2 million barrels per day in exports, it may eventually be forced to cut production from the current 9 million bpd, volumes that are still governed by OPEC+ quotas, as reported by Reuters.JP Morgan believes Russia could reroute around 800,000 bpd to markets like Egypt, Malaysia, Pakistan, Peru, Brunei, South Africa, and Indonesia. But that's not enough to offset the impact of major buyers like India walking away.Moscow also has a more disruptive card to play - the CPC pipeline. It moves up to one million bpd and is critical for Western oil majors such as Exxon, Chevron, Shell, ENI, and TotalEnergies. With a total capacity of 1.7 million bpd, any interruption would be felt globally."If we get a visible and substantial difficulty in clearing Russian crude and Putin shuts off CPC, oil prices might get well over $80 per barrel, possibly a lot more," said Crosby.The CPC line, which runs through Russian territory, has already seen clashes between the consortium and Moscow. In both 2022 and 2025, operations were temporarily suspended over claims of environmental and tanker violations.If CPC flows are cut and India halts purchases, the global oil market would lose about 3.5 million bpd, roughly 3.5% of total supply."The Trump administration, like its predecessors, will likely find sanctioning the world's second-largest oil exporter unfeasible without spiking oil prices," JP Morgan noted.The Centre for Research on Energy and Clean Air (CREA) estimates Russian fossil fuel revenues fell 18% year-on-year in Q2 2025, marking the weakest quarter since the Ukraine invasion. This drop came despite an 8% rise in export volumes compared to Q1.Meanwhile, Russian fossil gas exports to Europe continued their steady decline. Following the end of gas transit through Ukraine in Q1, exports fell further in Q2, dropping 9.4% from April (3.32 bcm) to June (3.01 bcm).A significant share of Russia's oil is still moving aboard G7+ tankers. In June, over 56% of seaborne oil exports used vessels from G7 or allied nations, up from 36% in January.Enforcement of the oil price cap remains patchy, but it's showing potential. CREA estimates that rigorous implementation since the sanctions began could have cut Russian export revenues by 11%, or EUR 39.51 billion. In June alone, full enforcement would have trimmed revenues by around EUR 550 million.The European Commission is now proposing to lower the price cap to $45 per barrel. CREA's modelling suggests that at that level, Russian revenues for June would have dropped by 28%, a loss of EUR 3.1 billion. Donald Trump 's approach to diplomacy, loud, transactional, and often antagonistic, is a key reason this convergence exists.His administration's rhetoric has been unforgiving. Stephen Miller, Trump's senior adviser, put it bluntly on Fox News: 'People will be shocked to learn that India is basically tied with China in purchasing Russian oil.'He went on to call India's actions 'unacceptable,' accused New Delhi of imposing 'massive' tariffs on American goods, and even dragged immigration into the debate.But this time, the pressure is not one-sided. China is under the same threat, tariffs, isolation, diplomatic friction. And that's where the real shift is happening. Neither India nor China is adjusting course. Both are pushing back, not in coordination, but in parallel.The BRICS bloc, now expanded to include Egypt, Iran, Ethiopia, and the UAE, is steadily positioning itself as a platform for collective pushback against Western dominance. Official statements from recent BRICS finance meetings have repeatedly criticised 'unilateral' trade measures and championed financial cooperation that bypasses Western systems.'You know, they have BRICS, which is basically a group of countries that are anti-US, and India is a member of that... It's an attack on the dollar, and we're not going to let anybody attack the dollar,' Trump said at the White House last week.Declarations from recent gatherings, including the 17th BRICS Summit in Rio de Janeiro in July 2025, back this view. These communiqués openly challenge the use of tariffs and non-tariff barriers they see as incompatible with WTO rules. The bloc continues to frame itself as a defender of multilateralism and a rules-based trade order, one not dictated by Washington or its allies.BRICS is also making concrete moves to reduce dependence on the US dollar and SWIFT. Initiatives like BRICS Pay and the New Development Bank (NDB), which lends in local currencies, are central to this shift. The July summit also launched a new 'New Investment Platform' (NIP) to deepen financial ties among member states.India and China, despite their bilateral tensions, remain pivotal within the bloc. What they do agree on is resisting Western economic pressure, and Trump may be accelerating that alignment.His remark that India and Russia can 'take their dead economies down together' wasn't just inflammatory; it underlined how seriously Washington now views the potential for coordinated economic defiance.This isn't a formal alliance. It's not even a soft partnership. India and China remain rivals, their border remains tense, and their visions for Asia are fundamentally different.But right now, their interests overlap in a meaningful way: both want autonomy. Both want access to cheap oil. Both reject being told what to do, especially by Washington.The world's two most populous nations are making energy decisions based on national need, not diplomatic pressure.