India buys over 2 million barrels per day of Russian crude at recent monthly levels. Here’s how the proposed 100% US tariff could affect India, Russia and global oil prices.
New Delhi: India’s dependence on Russian crude oil has come back into focus after the US House of Representatives passed legislation that would give President Donald Trump the power to impose tariffs of up to 100% on goods from major buyers of Russian oil and natural gas. India is among the countries potentially affected because of the scale of its Russian crude purchases.The proposed measure does not automatically impose a 100% tariff on India. It gives the US President authority to decide whether to impose the additional tariffs and at what level. The legislation also contains provisions allowing sanctions to be waived under certain circumstances.
How Much Russian Oil Is India Buying?
India has significantly increased its purchases of Russian crude since 2022, when Western sanctions and the restructuring of global oil trade created opportunities for Indian refiners to buy Russian barrels.
According to Kpler data cited by Indian media, India imported around 2.08 million barrels per day (bpd) of Russian crude in August 2026, equivalent to roughly 45% of India’s total crude imports.
However, different datasets and time periods show considerable variation. Reuters reported that Russian crude accounted for a record 50.83% of India’s oil imports in July, equivalent to approximately 2.47 million bpd.
What Does the US 100% Tariff Provision Mean?
The legislation passed by the US House on September 16 would allow the President to impose up to 100% tariffs on goods imported from the five largest importers of Russian crude oil or gas by volume, subject to the conditions in the legislation. The House vote was 262-159, and the bill is now awaiting further action.or India, this creates an important distinction:
India would not automatically pay a 100% tariff on Russian oil. Instead, the potential tariff would apply to Indian goods entering the US, if the administration chose to impose it.
That means the measure could affect India’s broader exports to the American market rather than directly putting a 100% duty on every barrel of Russian crude imported by India.
Why Is Russian Oil Important for India?
Russia became India’s largest crude supplier after the Ukraine war disrupted traditional global oil flows. Russian crude was offered at attractive prices to buyers outside the Western sanctions coalition, while Indian refiners expanded purchases.
The importance of Russian crude has increased further during periods of disruption to supplies from the Middle East. Reuters reported that Indian refiners continued buying Russian barrels even after earlier efforts to reduce purchases, as disruptions to Middle Eastern supply increased pressure on alternative sources.
Replacing such a large volume quickly could therefore be challenging. Industry executives cited by The Economic Times said replacing Russian crude would be difficult amid supply constraints and logistical challenges, with the potential to put upward pressure on global oil prices.
What Could Happen to Indian Oil Prices?
If Indian refiners substantially reduce Russian purchases, they would have to source additional crude from other producers.
Potential replacement sources include countries such as Iraq, Saudi Arabia, the UAE, Brazil and Angola, although the availability, price, quality and freight economics of those barrels vary.
More expensive replacement crude could increase refiners’ procurement costs. Depending on global prices, refining margins and government tax policies, some of that increase could eventually affect petrol, diesel and other petroleum-product prices.
However, the actual impact cannot be determined solely from the proposed tariff because it would depend on:
- Whether the US President actually imposes the tariff
- The tariff rate selected
- India’s response
- The extent to which Indian refiners reduce Russian purchases
- Availability of alternative crude
- Global oil prices and shipping costs
- Movements in the rupee-dollar exchange rate
What Could Be the Impact on Russia?
For Russia, India is one of its biggest crude customers. Data from the Centre for Research on Energy and Clean Air shows that in August, China accounted for about 50% of Russia’s crude exports and India about 37%, highlighting the concentration of Russian crude sales among major Asian buyers.
If India and other major buyers reduce purchases because of secondary tariffs, Russia could face a smaller pool of buyers or be forced to offer deeper discounts to maintain volumes.
At the same time, Russia could attempt to redirect more crude towards China, Turkey and other markets, potentially increasing competition for available buyers.
Could Global Oil Prices Rise?
This is one of the biggest potential consequences.
If millions of barrels of Russian crude are suddenly displaced from established trading routes, the global market would need to find replacement supplies or adjust through higher prices.
The impact would depend on how much Russian oil is actually removed from the international market. If Russian crude simply changes destination and continues reaching global consumers through alternative trading arrangements, the effect could be smaller.
But if sanctions substantially reduce Russia’s export volumes, the reduction in global supply could put upward pressure on crude prices.
This matters for major oil-importing economies across Asia, Europe and elsewhere because higher crude prices can increase transportation, manufacturing and energy costs.
What Could Happen to the Global Oil Market?
The proposed US measure could potentially accelerate several existing trends:
1. More diversification of crude suppliers:
Countries heavily dependent on Russian oil may seek additional supplies from the Middle East, Africa and the Americas.
2. Higher freight and insurance costs:
Longer shipping routes and sanctions-related restrictions could increase transportation costs.
3. Greater price differences between crude grades:
Refiners could face different economics depending on the quality and location of replacement crude.
4. More pressure on global oil prices:
A significant reduction in Russian exports could tighten the global supply-demand balance.
5. Expansion of alternative trading channels:
Major buyers and sellers could increasingly use non-dollar payment mechanisms and alternative shipping and insurance arrangements.
India Faces an Energy-Security Balancing Act
For India, the issue is not simply about choosing between Russia and the US. It involves energy security, crude availability, refining economics, export access and foreign-policy considerations.
India imports more than 80% of its crude oil requirements, making the availability and price of international crude particularly important for the domestic economy.
The proposed US legislation therefore creates a potential trade-off: maintaining large Russian crude purchases could expose Indian exports to additional US tariff risks, while sharply reducing Russian purchases could raise crude procurement and refining costs if alternative supplies are more expensive.
Aman 
Energy News