India Boosts U.S. Crude Oil Imports by 120% Amid Trade Tensions

India has significantly increased its imports of U.S. crude oil this year, marking a 120% rise in the first four months compared to the same period last year. This strategic move comes as India aims to secure a temporary trade agreement with the U.S. before the July 9 deadline, which marks the end of a 90-day suspension on reciprocal tariffs. The deadline is crucial as it could lead to a 26% tariff on Indian exports to the U.S. if no agreement is reached.

India's efforts to bolster its U.S. crude oil imports are part of a broader strategy to ease trade tensions with the Trump administration. The country has also reduced its oil imports from Russia, Saudi Arabia, and Iraq by over 70% during the same period. Despite Russia remaining India's largest oil supplier, New Delhi is actively rebalancing its energy import structure. This shift is particularly notable as India works to finalize a temporary trade agreement with the U.S. before the July 9 deadline, when reciprocal tariffs are set to take effect.

India's trade deficit with the U.S. reached 45 billion dollars last year, making it a focal point for the Trump administration's pressure. Concurrently, the U.S. Senate is considering legislation that would impose a 500% tariff on countries purchasing Russian oil, with India being a primary target. In response, India is attempting to reshape its trade narrative with the U.S. by challenging the characterization of India as a "tariff king" and proactively lowering tariffs on various goods, including the elimination of the "Google tax" and tax reductions benefiting U.S. motorcycle brand Harley-Davidson.

India is also striving to rebalance its trade relationship with the U.S. to avoid higher tariffs based on the U.S.'s trade deficit with India. In an environment where trade is increasingly used as a geopolitical tool, India must balance economic interests with diplomatic and national security policies. The U.S. Commerce Secretary recently indicated that negotiations with India are nearing a critical juncture, with several agreements expected to be announced in the coming weeks. This development follows the U.S.'s announcement of reciprocal tariffs, which has led to slow progress in negotiations with multiple countries. The White House has urged trading partners to accelerate talks, with high-level U.S. officials, including the Treasury Secretary, engaging in discussions with countries like Vietnam, Japan, and India. The Treasury Secretary has warned that if negotiations are not conducted in good faith, tariffs could revert to pre-suspension levels.