Puri warns Russian oil cut off could push prices to $130-$140/barrel

Update: 2025-07-17 20:10 GMT

NEW DELHI: Union Petroleum Minister Hardeep Singh Puri on Thursday cautioned that taking Russian supplies off the market could push oil prices to $130–140 per barrel, detailing the potential impact of secondary sanctions. He added that U.S. President Donald Trump’s tariff threats were not yet a cause for concern for India.

At the same time, he said India does not see any oil supply disruption if its Russian crude imports get impacted as the country has diverse sources of oil and enough supply is available in the global market. Puri’s comments come a day after NATO Secretary General Mark Rutte said that countries like India, China, and Brazil could be hit very hard by secondary sanctions if they continued to do business with Russia.

The NATO chief’s remarks come amid tariff uncertainties and global trade wars with the US, and India’s own trade with Russia, particularly oil imports. In recent times, there have been concerns in India over a controversial Bill in the US that proposed 500 per cent tariffs on countries that continue to trade with Russia. More recently, US President Trump also threatened “biting” secondary tariffs at the rate of 100 per cent on buyers of Russian exports unless there is a Russia-Ukraine peace deal within 50 days.

On the international front, Puri defended India’s insistence on going ahead with crude oil imports from Russia despite Western criticism, in terms of both legality and national interest.

He said, “In February 2022, when the Russia-Ukraine war began, we were importing 0.2 per cent of our crude oil from Russia. Today, we have increased — yes — but our diversification has also increased. Now, we import from around 40 countries, whereas in the past it was 27.”.

Replying to the critics who advise against buying Russian oil, Puri remarked, “Some said — do not buy Russian oil. But I ask — is it sanctioned? No, it’s not. Not for us. So why should we not buy from wherever we can, especially if it is good for the Indian consumer?” He added with conviction, “I do not feel any pressure.”

The minister again reasserted that consumer-first is the guiding philosophy behind India’s oil import policy. “The Prime Minister has been clear as daylight — our commitment is to the Indian consumer. We will do whatever is required to safeguard their interest and provide energy availability at the best possible prices,” he stated.

The oil and gas sector in India is currently experiencing a significant transformation marked by bold policy initiatives, increased exploration activities, and a clear movement towards enhancing energy security and diversification.

The minister articulated a forward-thinking vision during a conclave attended by industry leaders and stakeholders in the national capital, prioritising national interest and consumer welfare in the decision-making process, thereby challenging traditional paradigms.

One of the biggest pluses in the minister’s statement was the ninth round of the Open Acreage Licensing Policy (OALP), its success. He announced that “38 per cent of the bids received came from a one million square kilometre area that was previously considered a ‘no-go’ zone,” referring to areas that had long been off-limits because of defence and strategic activities by the Indian Navy, Coast Guard, or DRDO.

Describing how these entrenched obstacles were removed, Puri added, “Earlier, if you wanted to conduct exploration, these agencies would use their influence and say this has to be a no-go area. But the Prime Minister made a bold decision. He said, ‘You are doing excellent work, but I am still giving a million square kilometres for exploration.’ That has changed the game.”

This policy shift has already resulted in a major spike in activity. ONGC has drilled 578 wells during the current year, a record high in almost four decades. “The CMD ONGC has drilled more wells this year than likely in the last 37 years altogether,” Puri said, highlighting the record scale of investment. “Just consider — it takes a $100 million offshore well and a $4 million onshore well. This is no small investment.”

The minister attributed some of this pace to a leadership strategy shift at the core of public sector initiatives. “Before, oil company CMDs used to come for four-and-a-half months or six months. What strategic calls can they possibly make?” he wondered. “Now, we’re making appointments for the complete 10-year term. They are taking long-term calls, putting money into exploration and production — and it’s paying dividends.”

The minister also referred to the reform of the law introduced by the Offshore Areas Mineral (Development and Regulation) Amendment Act (ORD Act). He referred to the pre-existing legal regime, which was from 1948, as antiquated. “Be it a mine in Odisha or a petroleum lease in the Andamans, the same law used to apply. Mining acquired a new law in 1976, but the oil industry remained saddled with the 1948 Act. The ORD Act is a paradigm shift,” he added.

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