India said it will keep buying Russian crude as long as it stays affordable.
Narendra Modi hugged Vladimir Putin in Tianjin on Monday right there at the regional SCO Summit in front of cameras. Then they got into the same car and headed to a private meeting.
All this while Washington fumes over India’s Russian oil purchases. The U.S. says it’s funding the war in Ukraine. Modi’s response? A joint car ride with Putin, Kim Jong Un-style.
Modi later posted the two of them on X too, saying, “President Putin and I traveled together to the venue of our bilateral meeting. Conversations with him are always insightful.”
This meeting came days after President Donald Trump’s White House hiked tariffs on Indian goods to 50%, the highest rate slapped on any Asian country.
Modi isn’t apologizing. He’s not scaling back either. In fact, he’s been crystal clear that India will continue buying Russian oil as long as it remains affordable.
Last week, the chairman of Oil and Natural Gas Corporation, India’s top explorer, said their refineries will buy “every drop of Russian crude” that makes financial sense. No mixed signals. Just crude math.
Meanwhile, oil prices nudged up on Monday. Brent rose 62 cents to hit $68.10 a barrel, and U.S. West Texas Intermediate climbed 65 cents to $64.66. Markets are jumpy after renewed Russian airstrikes on Ukraine.
Add a weakening dollar and a U.S. holiday, and you’ve got a muted but uneasy session. Both Brent and WTI fell more than 6% in August, ending a four-month streak of gains. OPEC+ increased supply, and now traders are staring down a possible surplus.
Tankers coming out of Russia’s ports dropped to 2.72 million barrels a day, the lowest in like a month. Analysts warn this decline, paired with Trump’s tariff threats, could spook buyers or dent demand. But not India.
HSBC analysts expect inventories to grow in the final quarter of 2025 and early 2026. Their projection: a surplus of 1.6 million barrels per day by Q4. That’s not ideal for exporters, but New Delhi’s priority is price, not politics.
Before flying to Tianjin, Modi had spoken to Ukraine’s Volodymyr Zelenskiy about peace, again. Zelenskiy said India was ready to “deliver the appropriate signal to Russia and other leaders.”
The statement came before Modi’s face-to-face with Putin, making India look like it’s trying to wear two hats; one friendly to Russia, one open to Kyiv.
Putin is still expected to visit India later this year, which means this diplomatic triangle isn’t going anywhere.
Back in D.C., Trump keeps talking about “punishing” Putin, but he’s holding back. Russia’s battlefield strategy remains unchanged, and yet, the White House hasn’t dropped the next round of sanctions. There’s no full-blown economic squeeze, like on the others. Just a private 4-hour meeting between the two “friends.”
Chris Weafer, chief executive of Macro-Advisory, told CNBC:
“The Russian budget is actually under a lot of pressure… so if there were to be any more significant sanctions targeting Russian oil trade from the U.S. — which they’ve talked about but not done — that would put the budget under greater pressure. It hasn’t happened.”
Why is Trump hesitating? Two reasons. First, he still wants to play peacemaker. He’s said it publicly: if he can bring Ukraine and Russia to the table, it would be a huge win. With the Nobel Peace Prize announcement expected in October, he’s got motivation.
“Trump still thinks he can bring both sides to the table, that he could broker a peace deal, and that he can take credit for moving the conflict towards peace,” Weafer added.
The second reason is China. If Trump crushes Russia economically, Putin has only one place to turn. Beijing. Full isolation from the West would lock Moscow into China’s orbit. That’s not a win for Washington either.
“If Russia is completely isolated by the West… then it has no choice but to go even further all-in with China,” Weafer said. That’s the tradeoff. Sanctions or strategy.
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