India could face the possibility of tariffs of up to 100 per cent on its exports to the United States over its continued purchase of Russian oil.
The threat followed the passage of a bill by the US House of Representatives on Wednesday giving President Donald Trump broad powers to impose sanctions on Russia and tariffs of up to 100 per cent on countries buying Russian oil and gas.
The bill is expected to go to Trump for signing.
India and China are among the countries most exposed to the proposed measures, as both are major buyers of Russian crude.
According to the Centre for Research on Energy and Clean Air, China accounted for about half of Russia’s crude oil exports between December 2022 and August 2026, while India accounted for 37 per cent.
Russia supplied 30.3 per cent of India’s crude imports in the 2026 fiscal year, worth $40.8bn out of the country’s total crude import bill of $134.7bn, according to the Global Trade Research Initiative.
In July alone, Russian crude made up more than half of India’s crude imports.
The United Arab Emirates accounted for 10.8 per cent, Saudi Arabia 9.6 per cent, Venezuela 6.3 per cent, Brazil 5.5 per cent, Oman 5.3 per cent and the US 2.9 per cent.
The proposed tariff is not a tax on Russian oil entering India.
Rather, it would target countries that continue to buy Russian energy, potentially affecting their exports to the US.
India’s government said it was monitoring developments and remained committed to ensuring energy security for its population.
The government also said the issue had been discussed at high levels with US officials in recent months, adding that Delhi had made clear the possible consequences for bilateral relations and the global energy market.
India has relied heavily on Russian crude since Russia’s invasion of Ukraine, benefiting from discounted supplies that helped lower the cost of one of its largest imports.
However, the economic advantage has narrowed as discounts have fallen and shipping, insurance and sanctions-related costs have increased.
Democratic Senator Richard Blumenthal warned India and China after the vote, saying they should source their oil and gas elsewhere.
Under the proposed legislation, countries would normally have 180 days to reduce Russian energy imports or negotiate with Washington, although the president could shorten the period.
India can source crude from other countries, but replacing Russian supplies on a large scale could increase costs.
S&P Global said alternative supplies could result in higher crude, freight and insurance costs, while longer shipping routes could add further pressure.
Kpler analyst Sumit Ritolia said the issue was not simply whether Russian oil could be sold to other buyers, but whether enough alternative crude would be available without tightening the global market.
India’s exposure is significant because it imports more than 88 per cent of the crude oil it consumes.
The Council on Energy, Environment and Water said more than 85 per cent of India’s crude imports come from six countries, several of which are in conflict-prone regions. It also said some Indian refineries cannot easily switch between different crude grades.
India’s strategic petroleum reserves are estimated to cover only about nine to 10 days of net oil imports, compared with roughly 200 days in Japan and 207 days in South Korea.
CEEW estimates that India saved about $12.6bn by shifting to Russian crude after 2022.
The proposed tariff could also affect Indian exporters to the US.
The United States imported about $104bn worth of goods from India in 2025, while two-way trade in goods and services stood at about $240bn, according to the US Trade Representative.
India’s major exports to the US include electronics, pharmaceuticals, machinery, jewellery, chemicals, textiles and petroleum products.
Electrical and electronic equipment accounted for about $25.8bn of Indian exports to the US in 2025, while pharmaceuticals contributed about $9.7bn and machinery about $7.2bn.
Michael Kugelman, a senior fellow at the Atlantic Council, said the proposed measure could have serious implications for India, particularly as Delhi and Washington continue sensitive trade negotiations.
He said India had taken steps to reduce its exposure to US tariffs through trade agreements with other markets, including the European Union, and stronger trade ties with China.
India also exports fuel made from Russian crude
India’s role in the Russian oil trade extends beyond buying crude.
Indian refineries process Russian oil into petroleum products, some of which are exported.
Russia has been forced to import more fuel after Ukrainian attacks damaged its refineries. According to CREA, Russian fuel imports reached a record 172,000 tonnes in August.
India supplied about 120,000 tonnes, or roughly 70 per cent, most of it petrol refined from Russian crude at a refinery in Gujarat.
The supplies were valued at about €78m.
The situation has left Delhi facing a difficult calculation over whether the savings from Russian crude are enough to offset the possible cost of losing access to the US market or facing higher tariffs.
Former Indian trade official and GTRI head Ajay Srivastava argued that India should continue buying Russian oil as long as it remains commercially competitive.
He also said Delhi should negotiate with Washington without allowing tariff threats to determine its energy policy.
The final impact will depend on the level of tariff ultimately imposed, the price of Russian crude, global oil prices, shipping and insurance costs, and whether India and the US reach an agreement or secure exemptions.
