India’s Silent Surge: Crafting an Energy Empire Amid U.S. Sanctions, Sanctioning Russia Act and Adani-Jio-bp Deal.
Jun 26
6 min read
India is at a geopolitical crossroads, facing a big shift in its energy and trade strategies due to the U.S. Senate’s Sanctioning Russia Act of 2025. This bill threatens 500% tariffs on countries like India, which relies on Russia for 35–40% of its crude oil to curb inflation. Simultaneously, a groundbreaking partnership between Adani Total Gas Ltd. (ATGL) and Jio-bp, announced on June 25, 2025, signals a bold domestic push toward energy diversification. Beneath the surface lies a web of strategic maneuvers, Adani’s sanctions scrutiny, India’s rupee-based trade pivot, and a potential BRICS energy bloc, pieced together. TheBrink uncovers these hidden dynamics, offering a predictive outlook on how India can navigate this.
The Sanctioning Russia Act: A Geopolitical Game-Changer
The Sanctioning Russia Act of 2025, led by Senators Lindsey Graham and Richard Blumenthal, aims to cripple Russia’s war economy by imposing tariffs of at least 500% (escalating to 1,000% every 90 days) on imports from countries buying Russian oil, gas, petrochemicals, or uranium. With 84 co-sponsors as of June 2025, the bill enjoys bipartisan support and could pass by late summer, targeting India and China, which together buy 70% of Russia’s energy exports.
Impact on India: India imports 2–2.2 million barrels per day (bpd) of Russian crude, 35–40% of its 5.1 million bpd total, saving $5–7 billion annually due to discounts of $10–15 per barrel below Brent crude ($80–85). Tariffs on India’s $83 billion U.S. exports (pharmaceuticals, textiles, IT) could cost $50 billion, or 1.5% of GDP, and raise inflation by 0.5–1%.
U.S. Risks: The U.S. depends on India for 40% of its generic pharmaceuticals. Tariffs could spike U.S. drug prices by 20–30%, risking shortages and political fallout.
Waiver Uncertainty: A 180-day presidential waiver for “national security” offers India a lifeline, but Trump’s transactional approach may demand concessions, like lower tariffs on U.S. agricultural goods.
The bill’s enforcement is uncertain due to complex oil supply chains. Refined Russian crude blends into products like diesel, making tariffs hard to apply.
India’s Russian Oil Dependence: A Fragile Lifeline
India’s reliance on Russian oil surged post-2022 Ukraine invasion, driven by economic pragmatism:
Current Data: In June 2025, India imported 2–2.2 million bpd of Russian crude, overtaking Iraq and Saudi Arabia. Russia’s share peaked at 40% in 2024 but dipped to 27% in February 2025 (1.4 million bpd) due to U.S. sanctions on 183 shadow fleet tankers and firms.
Economic Stakes: Russian oil, priced at $60–70/barrel, saves India $6–8 billion annually, stabilizing the rupee and keeping inflation at 5–6%. Replacing Russian volumes with Middle Eastern or U.S. oil could raise import costs by $10–15 billion, pushing inflation to 6–7%.
Sanctions Impact: Indian refiners, including Reliance and Bharat Petroleum, halted trade with sanctioned entities in January 2025 but maintain supplies via non-sanctioned tankers during a two-month wind-down period. Payments have shifted to rubles or UAE dirhams, completed in two days instead of five, to bypass U.S. financial systems.
India’s state refiners are quietly negotiating with new Dubai-based traders to replace sanctioned firms, ensuring Russian oil flows. This rapid reconfiguration, unreported widely, shows India’s agility in sanctions-proofing its supply chain.
Adani-Jio-bp Partnership: A Strategic Counterweight
The June 25, 2025, partnership between ATGL and Jio-bp to integrate 650 CNG stations and 2,000 fuel outlets is a game-changer for India’s energy landscape:
Details: The deal combines ATGL’s CNG infrastructure with Jio-bp’s petrol and diesel networks across 125 districts, while exploring compressed biogas (CBG), EV charging, and LNG for transport. It challenges state-run firms (90% of India’s 97,000 fuel outlets) and aligns with India’s 2030 goal of 50% non-fossil fuel energy.
Connection to Sanctions: By expanding domestic CNG and CBG, the partnership reduces India’s 88% oil import dependency. ATGL’s focus on domestic natural gas (15% of India’s energy mix by 2030) and Reliance’s refining capacity (Jamnagar processes 1.4 million bpd) could offset Russian oil losses by 10–15% over five years.
Broader Alliance: The deal follows Reliance’s 26% stake in Adani Power’s Mahan Energen Ltd. (March 2025), hinting at a deeper Ambani-Adani collaboration to dominate energy markets. Joint ventures in LNG or refining could secure non-Russian supplies, a strategy barely discussed in mainstream analyses.
The partnership’s timing, post-sanctions, suggests a calculated move to preempt tariff disruptions. Adani’s Mundra port, handling 30% of India’s Russian oil, and Reliance’s Jamnagar refinery are pivotal in rerouting supplies.
Adani’s Sanctions Scrutiny: A Hidden Risk
Adani Group’s role in India’s energy imports can raise some red flags:
U.S. Investigations: The U.S. Justice Department is probing Adani for potential Iranian LPG imports via Mundra port, suspected of sanctions evasion via manipulated AIS signals. Adani denies violations, citing Oman as the origin.
Prior Allegations: Adani faces U.S. bribery charges (November 2024) for power contracts and coal import fraud (2016–2024), inflating prices by 50–100%. If linked to Russian oil via shadow fleets, Adani could trigger tariffs, impacting ATGL and Jio-bp operations.
Mitigation: The Justice Department’s focus on drug cartels may deprioritize Adani’s probe, and India’s diplomatic leverage (pharma exports) could secure leniency.
Adani’s Mundra port is testing tankers for Russian oil, reducing reliance on shadow fleets. This shift could shield 20–25% of imports from sanctions, preserving $2–3 billion in savings.
Predictive Outlook: India’s Master Plan
India’s response to the Sanctioning Russia Act will blend diplomacy, diversification, and innovation:
Short-Term (2025–26):
Waiver Diplomacy: India will secure the 180-day waiver by leveraging its pharmaceutical exports and Quad role, offering U.S. agricultural access in return. Imports from Iran (200,000 bpd) and the U.S. (439,000 bpd in June 2025) will offset 20% of Russian losses.
Sanctions Workarounds: New Dubai-based traders and Indian-flagged tankers will maintain 60–70% of Russian volumes, with payments in rupees or yuan via BRICS mechanisms.
Medium-Term (2026–28):
Energy Diversification: India will boost solar and wind capacity (500 GW by 2030) and CNG/CBG infrastructure via Adani-Jio-bp, cutting oil imports by 10%. Refineries will process heavier Middle Eastern crudes, reducing Russian reliance to 15%.
BRICS Energy Bloc: India, China, and Russia will pilot a rupee-yuan trade system for Arctic LNG and Vostok oil, shielding 30% of India’s imports from U.S. sanctions.
Long-Term (2028–35):
Neutral Bloc Leadership: India will lead a “neutral bloc” with Brazil and South Africa, advocating for sanctions exemptions at the UN. This bloc could control 20% of global oil trade by 2035, countering U.S. dominance.
De-Dollarization: A BRICS clearing mechanism will process 50% of India’s energy trade, reducing U.S. financial leverage. Adani and Reliance may co-invest in African LNG, securing 500,000 bpd by 2030.
Tariff Cost: a big GDP Impact: 12.29%, Inflation Increase: 0.75%
This suggests a severe economic hit, but India’s strategic pivots could mitigate 50–60% of losses.
Adani-Reliance Synergy: The Adani-Jio-bp deal masks a broader plan to dominate India’s energy supply chain, from ports to retail, potentially controlling 25% of fuel distribution by 2030. Their collaboration could bypass 30% of U.S. sanctions, saving $3 billion annually.
BRICS Energy Pact: India is quietly negotiating a trilateral energy framework with Russia and China, leveraging Arctic LNG and Vostok oil. This could secure 1 million bpd at $50–60/barrel, insulated from Western sanctions, by 2028.
U.S. Backlash Risk: If India secures a waiver, Trump may demand tech transfer concessions (e.g., semiconductor IP), straining India’s $10 billion U.S. tech partnerships.
Global Implications
U.S. Economy: Tariffs could raise U.S. drug prices by $20–30 billion, impacting 60 million low-income Americans. Tech and defense ties with India may weaken, benefiting China.
India’s Rise: Retaining Russian oil and expanding domestic energy via Adani-Jio-bp positions India as a global energy hub, potentially surpassing China’s oil demand by 2027 (5.6 million bpd vs. 5.3 million).
Multipolar World: A neutral bloc led by India could shift 20% of global trade away from U.S. dominance, with BRICS handling $500 billion in energy transactions by 2035.
The Sanctioning Russia Act of 2025 threatens India’s economic stability, but its response, diplomatic waivers, sanctions-proof supply chains, and the Adani-Jio-bp partnership, reveals a master plan to secure energy and trade autonomy. By leveraging BRICS, Indian-flagged tankers, and domestic energy. This pivot, driven by Ambani-Adani synergy and a neutral bloc, could redefine global energy markets, making India a linchpin in a new economic order.
-Chetan Desai (chedesai@gmail.com)
