India faces 100% tariff threat over Russian oil after US House vote

India faces the threat of a 100% tariff on Russian oil imports after the US House of Representatives passed legislation giving President Donald Trump the power to impose such tariffs on countries buying Russian oil and gas. India and China are among the most exposed countries because they are major buyers of Russian oil. India purchased 37% of Russia's crude exports between December 2022 and August 2026, according to the Centre for Research on Energy and Clean Air (CREA).

Russian crude accounted for more than half of India's crude imports in the fiscal year 2026, valued at $40.8 billion out of a total crude import bill of $134.7 billion, as per the Global Trade Research Initiative (GTRI). In July, Russian crude supplied more than half of India's crude imports, more than the combined supplies from the UAE, Saudi Arabia, Venezuela, Brazil, Oman, and the United States.

The US bill is an attempt to pressure India to sign the bilateral trade agreement on one-sided terms. However, India buys Russian oil to secure affordable energy for its 1.4 billion people and has helped stabilize global supplies and prices. To be true, the economics of Russian oil have shifted, and the crude no longer carries the steep discounts that made it particularly attractive to Indian refiners.

China and India now need to find alternative sources of crude, but replacing Russian crude at scale would come at a price due to higher crude, freight, and insurance costs, as well as longer shipping routes.