U.S. seeks to expand energy sales to India. Why it could be a problem for

The United States is stepping up efforts to sell oil and gas to India as the world’s third-largest energy market grapples with supply disruptions from the Middle East and finds its alternatives shrinking after Washington ended waivers for Iranian and Russian crude.

But replacing oil and gas from the Gulf countries and Russia with American energy is a hard choice for India, experts said.

High freight costs, refinery infrastructure that is not fully compatible with U.S. crude, and longer delivery times are among the key obstacles to deepening energy trade with Washington.

On Wednesday, U.S. Ambassador to India Sergio Gor met India’s Minister of Petroleum and Natural Gas Hardeep Singh Puri to discuss “energy security and unlocking new opportunities for accelerating growth.”

While Puri did not disclose details of the discussions, Gor said in a post on X that the talks were focused on “expanding access to reliable American energy” to India and “supporting long-term energy security and diversity for both nations.”

Gor is not the first U.S. official to press India to buy more American energy. U.S. President Donald Trump has raised the issue repeatedly, at times even urging India to purchase Venezuelan oil supplied through Washington.

Disruptions in the Strait of Hormuz threaten about 50% of India’s crude imports, 60% of its liquefied natural gas, and almost all liquefied petroleum gas (LPG) supplies, according to a March 2 report by Citi. The impact is already being felt domestically.

Last month, even as U.S. Treasury Secretary Scott Bessent announced a 30-day waiver allowing Indian refiners to continue buying Russian oil, he said India was an “essential partner of the United States” and that Washington expected New Delhi to ramp up purchases of U.S. crude.

On Thursday, Bessent said the U.S. will not be renewing the “general license” on Russian or Iranian oil, and a previous waiver was meant only for sanctioned oil “that was on the water prior to March 11th.”

This has deepened New Delhi’s energy worries,  removing key sources of energy supply as global markets remain tight.

In February, as part of a broader U.S.-India trade deal, New Delhi said it “intends” to import more than $500 billion worth of U.S. energy, information and communication technology, coal, and other products.

With India facing an acute energy supply crunch, Washington is now pressing for those intentions to turn into near-term commitments.

But India is a net energy importer, and fuel accounts for a major share of its import bill. Any sustained rise in energy prices risks widening the current account deficit and undermining macroeconomic stability.