India could face trouble as US mulls ending sanction waivers on Russian oil

India is among the countries that have benefited from the waiver; US Secretary of State Marco Rubio has said the ultimate decision regarding the Russian waiver will be made by the Department of Treasury.

The United States has said it will like to end the sanction waivers granted to countries purchasing Russian oil, contending that these measures were time-limited to ease global supplies in the wake of the Iran war.

Testifying before the Senate Foreign Policy Committee, US Secretary of State Marco Rubio on Tuesday said the ultimate decision regarding the Russian waiver would be made by the Department of Treasury.

“We would like to end it as soon as we possibly can because the underlying policy of this country has been to sanction their oil. These are time-limited waivers for the purpose of opening up more global supply,” Rubio told the committee.

India is among the countries that have benefited from the waiver from US sanctions on the purchase of Russian oil.

Discounted Russian oil has helped Indian refiners secure cheaper supplies and contain import costs at a time of volatility in the energy market.

The US granted a waiver from sanctions on the purchase of Russian oil in March and extended it twice. The last extension was granted on May 17 for one month.

Democrat ranking member Jeanne Shaheen sought to know from Rubio whether he could make a commitment before the committee that the waiver would not be extended further when it expires on June 17.

Rubio said the sanctions waiver was an attempt to alleviate the global effect of the rising oil prices.

“The problem we're facing, too, is there's a contagion potential, and that is that at some point we can do strategic reserves, we can do some of the other things that we've done to alleviate global supply, but at some point you have to ensure — this is not so much for us,” Rubio said.

He said at the end of the day, the US economy is not in need of it, but other economies around the world have benefited from the Russian waiver.

If the US moves ahead and ends sanction waivers, Indian refiners will find it hard to buy Russian oil and they may be forced to source a majority of their crude requirements from suppliers in West Asia, Africa or the United States, which would come at a higher cost.