The US Treasury has issued a 30-day waiver (valid through April 4, 2026) that allows Indian refiners to purchase Russian oil currently stranded at sea.

This is being framed as a “deliberate short-term measure.”

By letting India absorb Russian crude that is already “floating” in Asian waters, Washington hopes to quickly inject supply into the market to cool down surging oil prices without providing long-term structural financial support to the Russian government.

The escalation of the US-Israel war against Iran has effectively throttled the Strait of Hormuz. With traffic reduced to a fraction of normal capacity and rising threats to tankers, India—which relies on this route for roughly 40% of its crude imports—faced a potential domestic energy shortfall.

This policy is a tightrope walk for both Washington and New Delhi.

For the US: It’s a pragmatic pivot. The administration had previously pushed India hard to drop Russian oil in favor of US energy as part of a bilateral trade deal. However, allowing a temporary “backdoor” for Russian oil is less damaging to the US economy than allowing oil prices to skyrocket past $100+ per barrel.

For India: New Delhi remains firm on its stance of “energy sovereignty.” While they are using the waiver to secure supplies, the Indian government has signaled that they don’t view their energy purchases as something requiring external permission, even while navigating the reality of their 25-day strategic crude reserve limit.

Beyond the immediate numbers, this underscores the fragility of global energy corridors. The effective blockade of the Strait of Hormuz has essentially weaponized global logistics. While the waiver provides a “stop-gap” for Indian refineries, it doesn’t solve the underlying issue: as long as the conflict in the Middle East continues, the global energy market remains highly vulnerable to supply shocks that no waiver can permanently fix.