'The Available Pool Is Limited’: Niramla Sitharaman Explains Why India Can't Simply Stop Buying Russian Oil

India cannot abruptly stop buying Russian oil as doing so could push up prices in an already constrained global market, Finance Minister Nirmala Sitharaman said on Tuesday.

Speaking at the BusinessLine Changemaker Awards, Sitharaman said India would continue to source energy from different regions, with availability, suitability and domestic energy security guiding its choices.

Her remarks came days after US President Donald Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act into law on September 18. The law authorises and expands sanctions, tariffs and prohibitions targeting Russia and extends existing sanctions on Iran.

The US legislation has added pressure on countries that continue to buy Russian energy, including India and China. Against this backdrop, Sitharaman stressed that replacing Russian crude is not simply a matter of finding another supplier.

Why India Can't Simply Stop Russian Oil

Sitharaman framed the issue around global supply constraints and India's energy requirements.

“India can get out of Russia and say all right I'm buying oil from somewhere else. The moment you come out the available pool which is limited is going to shoot up in price,” she said.

“It poses a severe challenge no doubt, but I think we will have to keep India's interest topmost,” she added.

Sitharaman said India was already diversifying its oil basket and would source energy from different parts of the world depending on availability and suitability.

“To replace all that we need 1.4 billion people, the requirement has to be met from so many different sources already we are diversifying our oil basket,” she said.

Sitharaman Flags Shrinking Oil Supply

The Finance Minister also pointed to recent disruptions affecting the global oil market.

“Today just look at it realistically with the attack in Saudi Arabia and some crossfire hit at some other Gulf-related refineries, the oil pool itself is coming down,” she said.

Her comments came as oil markets have remained sensitive to disruptions in the Middle East. Recent attacks and damage involving Gulf energy infrastructure have added pressure to available supplies.

Sitharaman said India's approach was therefore to diversify its crude basket rather than rely on a single source.

Why Refinery Capacity Matters

Sitharaman also highlighted the technical limits involved in switching crude suppliers.

She said Indian refineries are largely configured to process medium crude and that factors such as density and sulphur content determine whether a particular grade can be processed.

“So if you have to pick it up from somewhere else where it is available which cannot be even with some tweaking be treated by our refineries, what good is that for and whose cause are we then serving?” she said.

The issue, therefore, is not only whether alternative crude is available but whether it is suitable for India's existing refining infrastructure.

US Pressure On Russian Oil

The comments come as Washington steps up pressure on countries continuing to trade in Russian energy.

Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act on September 18. The White House said the law expands statutory sanctions and tariffs targeting Russia.

India has remained a major buyer of Russian crude since the Ukraine war disrupted global energy markets and Western sanctions altered established oil flows. New Delhi has maintained that its energy purchases are guided by market conditions and the country's energy-security requirements.