In a significant shift in India’s crude sourcing pattern, HPCL-Mittal Energy Ltd (HMEL) has stopped importing Russian oil, citing growing payment and compliance complications linked to Western sanctions. The move marks one of the first major pullbacks by an Indian refiner from Russian crude since the war in Ukraine began in 2022.
According to industry officials, HMEL halted Russian oil purchases in October 2025, after difficulties arose in settling payments through non-dollar currencies. The company reportedly faced challenges in using UAE dirhams and Chinese yuan due to tightening U.S. oversight on banks facilitating trade with Russian entities.
HMEL, a joint venture between Hindustan Petroleum Corporation Ltd (HPCL) and Mittal Energy Investments, has traditionally sourced a large portion of its crude oil from Russia, benefiting from steep discounts offered after Western sanctions. The refinery, located in Bathinda, Punjab, processes around 11.3 million tonnes of crude oil annually.
Analysts say the decision could impact refinery margins in the short term, as Russian crude has been key to India’s cost-efficient refining operations. India became one of Russia’s largest crude buyers after Europe imposed a ban on Russian oil imports.
A senior energy market expert commented, “The halt by HMEL signals growing financial friction in India-Russia oil trade. Other refiners may continue buying, but the risk environment is tightening.”
The Indian government has so far maintained that oil imports from Russia are guided purely by national interests and market economics, but refiners are increasingly cautious as global scrutiny over sanctions compliance intensifies.
