For the last three years, the Government of India has not reduced retail fuel prices despite claiming a historic $12.6 billion saving on crude oil imports from Russia. While the numbers look impressive on paper, critics argue that the benefits never reached ordinary citizens. Instead, questions are being raised on whether only a few corporate giants—Adani and Ambani—profited from this strategic shift.
The Russian Oil Shift: A Turning Point
Until 2022, India’s energy basket was dominated by Middle Eastern suppliers—Saudi Arabia, Iraq, and the UAE. These ties kept refineries alive but exposed India to volatile prices and political risks.
The war in Ukraine changed the global oil map. Western sanctions left Russia with surplus oil and fewer buyers. India seized the opportunity, importing discounted Russian crude and saving $12.6 billion in just one year. The move was hailed as smart economics and bold diplomacy, signaling India’s ability to navigate global shocks.
What Happened in the Past When Oil Prices Fell?
This is not the first time global oil prices shifted dramatically. During 2014–2016, when international crude prices collapsed, the then-government reduced fuel prices several times. Ordinary Indians saw petrol and diesel rates fall at the pump. https://cleartax.in/s/petrol-price-india-history
Even earlier, during the 2008 global financial crisis, India’s fuel policy was adjusted to protect citizens from inflationary shocks. Governments of the past—irrespective of party—recognized that cheaper global oil should translate into relief for the public.
But today, despite record savings from Russian crude, Indian consumers have seen no reduction in prices for three straight years.
No Relief at the Petrol Pump
For the common man, these savings meant nothing. Petrol and diesel prices in India remain frozen, even as households battle rising food and living costs. “If the government truly saved billions, why didn’t consumers see cheaper fuel?” is the burning question.
Critics argue that the government used Russian discounts to strengthen fiscal reserves and avoid subsidy pressure, but failed to pass on benefits to citizens. This raises concerns about transparency and fairness in energy policy.
Who Really Benefitted?
Adding to the suspicion is the question of who processes Russian oil in India. Reports suggest that tenders and refinery deals are dominated by a few major conglomerates, particularly Adani and Ambani.
Opposition leaders and policy analysts allege that the government’s “strategic energy savings” narrative may actually be a cover for crony capitalism—where select business houses capture the benefits of state policy.
While the Petroleum Planning & Analysis Cell (PPAC) confirms the massive import shift, the distribution of savings remains unclear. Were they used for public welfare, or funneled into private profit?
Global Ripples, Local Doubts
Internationally, India’s Russian oil gamble unsettled old allies. Europe scrambled for alternatives, Middle Eastern exporters lost ground, and Washington expressed unease. Yet New Delhi stood firm, calling it a purely economic decision.
Domestically, however, the silence over stagnant fuel prices and opaque refinery contracts continues to spark doubt. For many, the story of $12.6 billion savings looks less like a triumph of diplomacy and more like another chapter in the nexus of politics and big business.
The Road Ahead
India’s dependence on Russian oil is set to continue as long as discounts flow. But the government now faces dual challenges—managing Western pressure abroad and answering citizens’ questions at home.
If New Delhi cannot demonstrate that these savings benefit the public, the “energy victory” risks being remembered as a missed opportunity that enriched a few while leaving millions struggling with high costs.
India oil imports, Russian crude, Adani Ambani, oil price controversy, $12.6 billion savings, India fuel prices, government integrity, crony capitalism, oil history India, fuel policy
