India’s Energy Security Faces US Tariff Threat on Russian Oil

India is closely tracking a proposed United States law that could impose tariffs of up to 100% on nations purchasing substantial volumes of Russian oil. Randhir Jaiswal, spokesperson for the Ministry of External Affairs (MEA), confirmed on Friday that the government is aware of this developing legislation.

This proposed measure, known as the “Senator Lindsey O. Graham Sanctioning Russia Act of 2026,” has garnered bipartisan backing from over 60 US Senators. Its primary objective is to intensify financial pressure on countries whose continued acquisition of Russian oil and gas is perceived by the US as indirectly funding Russia’s military operations in Ukraine. Notably, this revised bill has reduced the maximum potential tariff from an earlier proposal of 500% to 100%.

India’s consistent position is that its crude oil procurement strategy is dictated by its core energy security requirements, rather than allegiance to any single supplier. Jaiswal highlighted India’s diversified sourcing approach, drawing crude from a wide array of global producers. As the world’s third-largest energy consumer, India relies on imports for approximately 85% of its crude oil needs. While traditional suppliers like Iraq, Saudi Arabia, and the UAE remain significant, India has strategically expanded its import portfolio to include non-OPEC producers and has substantially increased its uptake of Russian crude.

The structural shift in India’s import patterns became pronounced following the conflict in Ukraine, driven by the availability of discounted Russian oil. This has elevated Russia’s share to over half of India’s total crude imports, with recent figures reaching a record 2.6 million barrels per day. The economic rationale for these purchases is clear: managing import costs to stabilize domestic fuel prices and protect consumers.

Under the new US bill, the US government would gain authority to levy tariffs of up to 100% on the top five global purchasers of Russian crude oil and natural gas. The legislation outlines potential exemptions for countries importing less than 15% of Russia’s natural gas, provided they demonstrate active efforts to reduce these volumes. Furthermore, the bill allows for similar tariffs against the top five nations found assisting Russia in circumventing existing oil sanctions. The framework also includes provisions for sanctions against Russia’s political figures, financial institutions, energy companies, and wealthy individuals supporting the Kremlin, with a mandate for reviewing the top five buyers every 180 days.

This is not the first instance of US pressure; in August 2025, a 25% secondary tariff was imposed on Indian goods, directly linked to its ongoing Russian crude imports. India, however, maintains that its purchases do not violate international sanctions and are an indispensable component of its national energy security. The substantial support for this bill within the Senate underscores a persistent geopolitical tension between energy independence and international diplomatic alignment.