The European Union (EU) imposed its 18th package of sanctions in 2025 targeting Russia’s oil and energy sector. The new rules aim to restrict revenues from Russian crude oil by banning imports of refined petroleum products made from Russian crude and exported via third countries. This move affects nations like India, Turkey, and the UAE, which refine Russian oil and supply fuel to Europe.
of EU Sanctions
The EU’s latest sanctions prohibit imports of diesel, petrol, and jet fuel derived from Russian crude but refined outside Russia. The ban excludes certain allies such as the US, UK, Canada, and Switzerland. This step is designed to further reduce Russia’s oil revenue amid ongoing geopolitical tensions. It directly impacts countries that process Russian crude and export petroleum products to the EU market.
India’s Petroleum Export Risks
India’s petroleum exports to the EU, valued at USD 15 billion in 2024-25, face risks. The EU ban targets refined products made from Russian crude imported by India. Previously, India’s exports to the EU stood at USD 19.2 billion in FY24 but declined by 27.1% in the next year. The new sanctions may further reduce this trade volume and affect India’s refining sector.
India’s Crude Oil Imports from Russia
India imported crude oil worth USD 50.3 billion from Russia in FY25. This accounted for over one-third of India’s total crude oil import bill of USD 143.1 billion. Despite international pressure, India continues buying Russian crude for economic reasons. However, the changing political environment in Western capitals adds complexity to India’s energy diplomacy.
Geopolitical and Economic Balancing
India faces a delicate balance between economic pragmatism and geopolitical pressures. While Russian crude supplies help meet India’s energy needs affordably, Western countries view such trade with suspicion. India must navigate this challenge carefully to maintain energy security without jeopardising international relations.
Impact on Other Nations
Countries like Turkey and the UAE also refine and export Russian crude-derived petroleum products to Europe. They too will face similar restrictions under the EU sanctions. This could lead to shifts in global oil trade patterns and refining strategies as affected nations seek alternative markets or crude sources.
Broader Implications for Global Energy Trade
The EU’s sanctions on Russian oil refine trade show the increasing use of economic tools in geopolitics. They signal a tightening of global energy trade regulations linked to political conflicts. This may accelerate diversification of crude sources and refining capacities in various regions.
Questions for UPSC:
- Discuss in the light of recent EU sanctions, how economic sanctions influence global energy security and trade patterns.
- Analyse India’s energy diplomacy in balancing geopolitical pressures with economic interests, taking examples from its crude oil imports.
- With suitable examples, critically discuss the role of international sanctions in shaping foreign policy and economic relations among major powers.
- Examine the impact of crude oil trade restrictions on developing countries’ economies and their strategies to mitigate such challenges.
