New Delhi: US President Donald Trump has threatened to reinstate a 25% “punishment” if India does not stop buying Russian crude oil, deepening question marks over the operations of the Nayala refinery in Jamnagar. The crisis facing the refinery has sparked discussions about a change in ownership. While the refinery would be a good acquisition under normal circumstances, the United States’ hardline stance could be a stumbling block for potential buyers and will continue to be so unless there is a major breakthrough in negotiations that allows Russia to pause its aggression in Ukraine. Rosneft, the Russian state-run energy giant, has been sanctioned by the Trump administration in an effort to force Vladimir Putin to agree to suspend its offensive in Ukraine. Rosneft owns a majority stake in the 20 million tons per year refinery. Nayala in Vadinar (Gujarat) is the country’s second largest monomer refinery and specializes in processing heavy crude oil. Before U.S. sanctions were imposed, it relied almost entirely on Russian crude for feedstock. Analysts said India is likely to continue talks with the Trump administration to allow small imports of Russian crude, given the near-term outlook for refineries. Indian refiners have been reducing their purchases of Russian crude. Although observers say that even if India decides to reduce its reliance on Urals, it cannot stop purchases immediately because refiners have already booked Russian cargoes for the next eight to 10 weeks and canceling these orders is not feasible, but this does not eliminate uncertainty over Nayala’s fate. “My sense is that India will still be bargaining with the US to import a certain amount of oil from Russia, particularly the Nayala refinery,” said Prashant Vasisht, senior vice-president at ratings agency ICRA. Energy expert Narendra Taneja said India will also continue to import oil from Russia, albeit in lower volumes. “India will continue to receive oil supplies from Russia for two reasons: to maintain its strategic autonomy and to maintain the correct perspective on domestic political consumption,” he said. “Since India has to procure $500 billion from the US in five years, importing oil, natural gas and LPG is the best way to increase volumes quickly and overall it is not a bad idea as the returns we will get back (capital, technology and greater access to the US market) are very attractive,” he said. According to data from the Indian Ministry of Commerce, nearly one-third of India’s crude oil imports come from Russia, with purchases falling to US$2.7 billion in December 2025, the lowest monthly shipments in the past three years, and a decrease of nearly 27% from the US$3.7 billion recorded in November. Despite the decline, Russia remained India’s largest crude supplier in 2025-26, accounting for 31.5% of purchases worth $105.1 billion between April and December.