Washington halts crude waivers, choking India’s access to Russian and Iranian oil

The US will not renew temporary waivers that allowed India limited imports of Russian and Iranian crude, Treasury Secretary Scott Bessent said in a White House press briefing (watch, runtime: 41:19).

Waivers expire, supply clamped: Washington’s decision ends the short-term relief that had enabled buyers including India to purchase sanctioned crude already at sea.

Why it matters: Import-dependent economies like India had lobbied for an extension to offset disruptions to supplies from the GCC. Higher freight, ins. and crude prices are already feeding into fuel inflation across the country. While targeted exemptions remain possible, the US has not clarified if country-specific waivers will be granted.

IN CONTEXT- India’s crude imports from Russia surged nearly 150% in March following the waiver. Meanwhile, the first Iranian crude and LPG cargoes in almost seven years — since the 2019 US sanctions were imposed — arrived at Indian ports.

Hormuz compounds impact: The near paralysis of traffic through the Hormuz — through which about a fifth of global oil passes — is mounting supply risks for Indian refiners. A US blockade on Iranian supplies is further deterring shipments and removing barrels from the market.

Indian government expects bottlenecks to persist after the war

Disruptions to the global liquefied petroleum gas (LPG) supply chain could take three to four years to normalize, as uncertainty persists over damage to production and export infrastructure in the Middle East, Moneycontrol reports, citing a senior Indian government official. Even after rerouting shipments, supply disruption could remain at 40-50%, depending on the extent of damage to upstream infrastructure in the Gulf, analysts told the outlet.

REMEMBER- India meets about 60% of its LPG needs through imports, with the GCC historically accounting for the bulk of supply.

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