<h1>Indian refiners face costly challenges shifting from discounted Russian crude oil amid US tariffs and supply risks</h1> Indian refiners, heavily reliant on discounted Russian crude oil accounting for up to 38% of their intake, can technically operate without it but face significant economic and strategic drawbacks. Russian crude supports high yields of middle distillates like diesel and jet fuel, crucial for India's refining output. Replacing it with alternatives, primarily from the Middle East, the US, West Africa, or Latin America, would lower diesel yields, increase residue outputs, and erode refining margins due to higher costs and less favorable product mixes. The US has imposed steep tariffs on Indian imports as a penalty for continued Russian oil purchases, prompting discussions about supply diversification. However, alternatives are costlier, less compatible, and involve higher freight and credit charges. The Indian government warns that losing Russian supplies could raise import costs by $3-5 billion annually, strain fiscal balances, and limit crude purchases due to storage constraints, making the transition commercially challenging despite technical feasibility.