India Faces Potential 100% US Tariff Risk Over Russian Oil Purchases

India Faces Potential 100% US Tariff Risk Over Russian Oil Purchases

India faces potential US tariffs of up to 100% under a new Russia sanctions bill as Washington weighs action against major Russian oil buyers amid ongoing trade talks.

India could face a new tariff threat from the United States after the US Senate passed the Lindsey Graham Sanctioning Russia and Iran Act of 2026, giving the Trump administration authority to impose tariffs of up to 100% on five of the largest buyers of Russian oil and gas.

India is among the countries that could potentially be targeted under the legislation. China, Slovakia, Hungary and Azerbaijan could also come under its scope. The bill has already cleared the Senate by a large majority and will now be sent to President Donald Trump for his signature.

However, the legislation does not require President Trump to impose tariffs on countries buying Russian oil and gas. It also provides important exemptions for US European allies, based on the fact that several of these countries have taken steps to reduce their energy purchases from Russia.

US Senator Jeanne Shaheen, who played an important role in supporting the bill imposing sanctions on Russia, said, “Today is a big day. Congress has sent a clear message to Putin.”

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The bill comes as India and the United States are negotiating an initial trade agreement. India has also increased its purchases of Russian oil compared with last year. Under the legislation, the President would have the authority to waive sanctions in the national interest.

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India’s Ministry of External Affairs responded to the bill on Thursday. In a statement, the ministry said, “The Government of India has taken note of the passage of the Sanctioning Russia and Iran Act in the US Congress. We are monitoring further developments in this matter. As has been stated on several occasions earlier, the Government of India remains fully committed to ensuring the energy security of its 1.4 billion people. India will continue to do so based on changing market conditions and supplies from diverse sources.”

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India further said, “In recent months, the issue has been discussed at a high level with different representatives of the US Government. The potential implications of this legislation, not only for bilateral relations but also from the perspective of international energy markets, have been clearly conveyed by India. India has also made clear its resolve to take all necessary steps to safeguard its trade and economic interests. The Government will work with Indian trade and industry organisations to address the impact of these developments.”

India’s difficulties could increase

Ajay Srivastava, director of Delhi-based think tank Global Trade Research Initiative (GTRI), said the bill would increase India’s difficulties.

Writing on X, he said, “Russia’s share in India’s crude oil imports was 30.3 per cent in FY2026. Of India’s total crude oil imports worth $134.7 billion, $40.8 billion worth of oil came from Russia. In July 2026 alone, Russia’s share in India’s total oil imports was more than half.”

He said, “India buys Russian oil to ensure affordable and economical energy for 1.4 billion people, not to escalate the war. These purchases have also helped keep Russian oil in the global market, contributing to stabilising international supply and prices.”

Srivastava added, “Tariffs of up to 100 per cent could hurt Indian exporters, raise costs for American consumers and give the US President extraordinary power over major trading partners. Tariffs on Russian oil could be another step by the Trump administration to put pressure on India to sign a trade agreement on highly unequal terms.”

The five countries potentially targeted by the tariffs would be those that were the largest importers, based on the volume of their total imports of crude oil or natural gas from Russia during the 12 months preceding the date the law takes effect, and that intentionally made new purchases of Russian crude oil even 30 days after the bill becomes law.

In addition, any country among the five largest countries helping Russia evade sanctions on oil could also face tariffs of up to 100%.

Countries that have taken significant steps to reduce imports of natural gas from Russia, or whose share of gas imports is less than 15% of Russia’s total gas exports, would be exempt from the sanctions.

Opposition to the bill

Democratic lawmaker Steny Hoyer had introduced an amendment proposing that the bill include the top 10 countries importing oil from Russia: China, India, Turkey, Azerbaijan, Hungary, Slovakia, the UAE and Kyrgyz Republic. However, the amendment could not be included in the final version of the bill considered on Wednesday.

After the bill passed, Hoyer wrote on X, “Today Congress has taken a historic step and shown the courage of what America can and will do to defend freedom. I urge the President to sign this bill quickly to ensure Ukraine’s victory and Russia’s defeat.”

Following the war between the US and Israel and Iran, India’s oil imports from Russia reached an 11-month high in April this year.

India had earlier reduced its purchases from Russia, with imports reaching their lowest level in 38 months in December 2025. The Trump administration had announced an additional 25% tariff on India for buying energy from Russia, on top of the existing 25% tariff. After the US-Iran conflict disrupted supplies, the US Treasury temporarily paused sanctions on oil shipments that were already in transit before March 11, 2026.

Lindsey Graham, who had been a critic of India’s business ties with Russia, has had his name attached to the bill. Graham died suddenly on July 11 this year. The US Senate passed the bill by 86-11 votes on August 7.

Several prominent Democratic lawmakers, including Elizabeth Warren and Bernie Sanders, as well as some Republicans such as Rand Paul, opposed the bill. Their concerns included the broad powers it would give the President and the possibility that the cost of tariffs could ultimately fall on American citizens.

Several lawmakers also expressed concern that the legislation could further expand President Trump’s ability to impose tariffs on US allies such as Canada and the European Union.

What did Zelensky say about the bill?

Gregory Meeks, ranking member of the House Foreign Affairs Committee and the senior Democratic member of the committee, criticised the bill. Meeks said, “We cannot give the President more powers to impose tariffs that we know he will abuse.”

He said that even if President Trump limited tariffs to the five largest countries importing Russian oil, the cost would be at least $3,000 for every American family.

In a statement issued on Tuesday, Meeks said he supported sanctions on Russia. He argued that the President already had the authority to impose sanctions on Russia but was not using those powers.

New York Democratic leader Hakeem Jeffries spoke against the bill, saying Democrats would continue to support the people of Ukraine until victory was achieved, “but this bill provides no path to achieving that goal.”

Overall, 58 Democratic lawmakers voted for the bill against Jeffries’ position, while 152 voted against it. Among Republican lawmakers, 203 voted in favour of the legislation and seven voted against it.

House of Representatives Speaker Mike Johnson said, “For far too long, Putin has been waging this devastating war through the money and resources he receives from countries willing to look the other way, and today that ends.”

Before the vote, Ukrainian President Volodymyr Zelensky appealed to the US House through social media to pass the bill. He said that during wartime, sometimes “making a decision that is not completely right is better than doing nothing.”

Zelensky wrote on X, “And this is a very important historic moment for America. This bill should be passed, voted on and supported.”

He added, “In addition, it is important for the US administration to make strong decisions. President Trump’s personal decisions are also important. I really hope we will see this happen.”

 

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