No international sanctions on buying Russian crude, says Hardeep Singh Puri

Petroleum Minister Hardeep Singh Puri said India will keep importing Russian oil as no sanctions ban such purchases, while stressing PSU oil firms are profitable but undervalued

There are no international sanctions banning  crude oil purchases from Russia, Union Petroleum and Natural Gas Minister Hardeep Singh Puri said on Friday. 

Rejecting criticism from Western commentators, Puri, during a media interaction, said: “There are no sanctions on Russian oil. If you want to sanction Russia, then it has to be a proper sanction and apply to all. Then we will see what the consequences are.”

 

He added that energy is an essential commodity, and any global supply disruptions would sharply push energy prices higher and lead to inflation. “If you remove the world’s second-largest producer, you will either have to cut consumption, stop eating, or face very serious consequences. Prices will shoot up,” Puri said. 

 

Puri also emphasised India’s position as a responsible global actor. “We have always complied with sanctions in the past, whether on Iran or Venezuela. There are no sanctions in Russia. That is the broad reality,” he said, adding that discounts on Russian oil have come down and Indian refineries are now buying oil from all over the world.

 

Further, he noted that Russia has cut crude production in the last few months, which would impact energy prices. 

 

Puri also questioned the effectiveness of earlier Western price caps and sanctions. “Sanctions have never worked in the past. You put a sanction and they find a way to go around the sanctions. At present, Europe is buying (Russian crude oil), Turkey is buying, Japan is buying,” he said. 

 

A “broad equilibrium” is essential between the supply and demand for oil, the minister said, adding that he expects crude to continue to trade between $65-68 a barrel going ahead. 

 

He also defended India’s diversified approach to oil sourcing, calling it professional and transparent. We do not decide where Indian PSU companies buy their crude oil from. They are listed entities with independent boards and have a robust decision-making process. The Indian government has no say where PSU oil companies are buying their crude from,” he said.

 

PSU oil cos are undervalued

 

Puri said Indian stock markets are undervaluing state-run oil companies, despite their high profits and dividends. 

 

“Indian Oil, BPCL, and HPCL together account for 3.3 per cent of India Inc’s profits, but their combined market value is less than 1 per cent,” he said. 

 

He added: “Zomato and Swiggy together have a market capitalisation of ₹4.37 trillion, which matches the combined valuation of the three oil marketing companies. Yet since 2019, they (food delivery companies) have lost ₹24,000 crore, while PSU oil companies earned over ₹2.5 trillion in profit.”

 

Calling it a “perception bias” against government-owned companies, Puri said investors unfairly assume interference and policy risk. “While the PSUs are owned by the government, that does not mean interference. I don’t call the shots on tenders or contracts. These companies are independent, professionally managed, and highly profitable,” he stressed.

 

He highlighted the sector’s strong track record of returns: “In the last four years, their performance has been outstanding. The kind of returns they are giving — 42 per cent dividend in some cases — are unmatched,” Puri said.

 

The minister urged investors and analysts to reassess their approach. “The investor mindset has to change. Our companies are investing in green energy, petrochemicals, and future pathways while delivering profits. Yet markets continue to undervalue them,” he said, while ruling out any privatisation of the Indian oil companies.