Shares of Indian Oil were trading in a tight range on Thursday amid uncertainty over cutting back on Russian oil imports.

What Happened: Top oil refiners in India are reportedly backing away from long-term contracts for crude oil from Russian suppliers amid intensifying US sanctions, Bloomberg reported, citing sources.

Three of India’s state-owned oil refiners had reportedly been in talks with Russian energy giant Rosneft to lock in 500,000 barrels a day, about equivalent to one-third of India’s daily imports.

Indian Oil, is considering slashing crude supply from Russia under its long-standing term supply, while two other big firms, Bharat Petroleum and Hindustan Petroleum, have not committed to long-term contracts with Russian suppliers. Contracted deals would reduce dependence on one-off purchases, which are more expensive.

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The move away from long-term deals for Russian crude comes as sanctions from the West crack down on Russia’s oil trade, with India buying more from other nations like Saudi Arabia in February.

Though Russia is still the country’s biggest supplier of crude oil, Indian refiners are increasingly turning to Middle Eastern nations like Iraq, the United Arab Emirates, and Saudi Arabia. The shift dragged the country’s Russian oil imports to the lowest level last month since January 2023.

Sources told the publication that in the upcoming fiscal year starting April 1, state refiners plan to meet 40% of their crude needs through spot deals, indicating a large volume of Russian oil will still flow to India.

Price Action: Indian Oil’s share price was trading in a tight range, recovering some losses after dropping 0.2% near the start of trade on Wednesday.

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