Trade Shock For India? US Mulls 100% Tariff Over Russian Oil Imports Amid Ukraine War Pressure

ECONOMY & POLICY NEWS REPORT

WASHINGTON / NEW DELHI: A bipartisan group of US Senators has introduced a revised Russia sanctions bill that proposes imposing up to 100% tariffs on goods from the five largest buyers of Russian crude oil and gas, including India and China.The move is aimed at cutting off revenue to Russia for its war in Ukraine.

KEY POINTS OF THE BILL:

Who is targeted: The revised bill narrows its scope to the top 5 purchasers of Russian crude China, India, Slovakia, Hungary and Azerbaijan. For natural gas, the largest importers include China, France, Japan, Hungary and Belgium.

Tariff rate: It proposes up to 100% tariffs on imports from these countries. This is a sharp reduction from the original proposal of a blanket 500% tariff on all buyers of Russian energy.

Presidential waiver: The bill authorises US President Donald Trump to waive the sanctions if he determines it is in the US national interest.

Exemptions: Countries that import less than 15% of Russia's natural gas exports and are reducing dependence could be exempted. 

The bill is named the Lindsey O. Graham Sanctioning Russia Act of 2026, after late Senator Lindsey Graham who co-sponsored it with Democratic Senator Richard Blumenthal. 

WHY IT MATTERS FOR INDIA:

India currently sources around 50% of its oil requirements from Russia.

According to Kpler data, India’s Russian crude imports hit a record 2.58 million barrels per day in June, accounting for nearly half of total crude imports. July volumes are also expected to remain strong. 

The bill comes at a sensitive time as India and the US are negotiating an interim trade agreement.

BROADER CONTEXT:

The legislation seeks to deprive Vladimir Putin of revenue financing Russia’s war against Ukraine through sanctions on Russia’s political leadership, financial institutions, and energy sector. 

The US Senate voted 86-12 to fast-track the bill. However, it still needs to pass both the Senate and House of Representatives before reaching President Trump for signature. aa219aff

US POSITION:

Senator Blumenthal said the tariffs are “narrowly limited to the five major purchasers” and include waiver authority. The bill also exempts Russian uranium imports for US nuclear reactors.