The European Union (EU) should crack down on India reselling Russian oil as refined fuels including diesel into Europe, the blocs chief diplomat has said, as western nations move to tighten sanctions on Moscows energy sector, the media reported.

Josep Borrell, the EU's high representative for foreign policy, told The Financial Times that Brussels was aware that Indian refiners were buying large volumes of Russian crude oil before processing it into fuels for sale in Europe, saying for the first time the EU should act to stop it.

"If diesel or gasoline is entering Europe?.?.?.?coming from India and being produced with Russian oil, that is certainly a circumvention of sanctions and member states have to take measures," Borrell said.

India has become one of the biggest buyers of Russian crude oil since the invasion of Ukraine, with its refiners earning large margins by buying heavily discounted crude that is now largely barred from the EU, before selling full-priced fuels into Europe, The Financial Times reported.

The trade is legal under EU sanctions but has been criticised by those who want to see harsher sanctions imposed on Russia and argue that it has allowed Moscow to keep earning large revenues from its oil sales -- the biggest component in the Kremlin's budget.

Borrell acknowledged that the G7 price cap -- which aims to limit Russian crude oil sales to other countries to $60 a barrel -- had helped cut Russia's oil revenues, and said it was understandable India wanted to take advantage of cheaper crude.

But the top EU official suggested he was uncomfortable that much of that oil was now flowing back to Europe in the form of refined fuels, The Financial Times reported.

"That India buys Russian oil, it's normal. And if, thanks to our limitations on the price of oil, India can buy this oil much cheaper, well the less money Russia gets, the better," Borrell said.

"But if they use that in order to be a centre where Russian oil is being refined and by-products are being sold to us? We have to act."

Borrell's comments come ahead of a meeting on Tuesday with India's External Affairs Minister S. Jaishankar, where he will raise the issue, he said.