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US Sanctions Law Threatens India's Russian Oil Trade
Developing
In Short: U.S. President Donald Trump signed a new sanctions law that could impose up to 100% tariffs on countries importing large volumes of Russian oil, potentially affecting India's trade.
U.S. President Donald Trump signed the 'Lindsey O. Graham Sanctioning Russia and Iran Act of 2026' into law on Friday, authorizing and expanding sanctions on Russia and extending existing sanctions on Iran.
The new law grants the President the authority to impose tariffs of up to 100% on countries that are major importers of Russian oil and natural gas.
India, one of the largest buyers of Russian crude oil, could face these tariffs if it continues to import significant volumes of Russian oil.
In July, India's crude oil imports from Russia reached a record high of 2.8 million barrels per day, accounting for more than half of India's total crude oil imports.
According to energy flows analytics firm Kpler, India's purchases from Russia are expected to stabilize at around 2 million barrels per day going forward.
India's Foreign Ministry stated that the country remains committed to ensuring energy security through diversified sourcing and market dynamics.
Michael Kugelman, a senior fellow at the Atlantic Council, noted that the timing of the new legislation could negatively impact ongoing trade negotiations between India and the United States.
India has reportedly discussed the issue with the U.S. at high levels, but the potential tariffs could sour trade relations between the two countries.
What this adds
The exact impact of the new sanctions on India's trade with the U.S. remains uncertain.
The law's implementation and any potential exemptions for India have not been clarified.
What's still developing
- Moreover, the potential tariffs could sour trade relations just as New Delhi and Washington have been negotiating a bilateral trade deal for months.
- “From the perspective of the trade talks, this new legislation couldn't have come at a worse time,” Michael Kugelman, a senior fellow at the Atlantic Council in Washington, told Reuters last week.
- Prague Caps Fuel Prices, Taxes Orlen's ‘Windfall’ Refining Margins What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,… India’s imports of cheaper Russian crude oil have come under scrutiny in recent days after U.S.
- Related: Hormuz Blockage Puts Qatar's $83 Billion LNG Bet at Risk Last month, India’s imports of Russian crude oil eased slightly from the record-high in July, as Ukrainian attacks on Russian export infrastructure and competition from China for Russia’s barrels dented India's intake of Moscow’s oil.