India Rebuffs US Tariff Threat Over Russian Oil Trade
India issued a sharp rebuttal after US President Donald Trump threatened to “substantially” raise tariffs on its goods over the purchase and resale of Russian oil. India’s Ministry of External Affairs called the threat “unjustified and unreasonable,” noting that the US and EU also continue to trade with Russia. New Delhi asserted it would take all necessary measures to safeguard its national interests. The spat marks a significant escalation in trade tensions, highlighting India's delicate balancing act between Western allies and its strategic partner, Russia.
Unpacked:
India began increasing Russian oil imports after the Ukraine conflict in 2022, as Western sanctions made Russian crude available at steep discounts. As the world’s third-largest oil importer, India leveraged these discounts to reduce energy costs, manage inflation, and stabilize fuel prices, even as many Western countries reduced their purchases from Russia.
Before 2022, Russian oil made up less than 0.2% of India’s imports. By 2025, Russia became India’s top supplier, providing up to 40% of its crude imports, surpassing traditional suppliers like Iraq and Saudi Arabia. This shift dramatically changed India’s energy sourcing profile.
US tariffs could force India to pivot away from discounted Russian oil, leading to a projected $9–11 billion spike in oil import costs. This would introduce cost uncertainties, hurt profit margins for Indian refiners, and potentially increase inflation, affecting the broader economy and consumers.
While the US and EU sanctioned Russian oil, some European countries continued selective imports or used loopholes. China remains the largest importer, and nations like Hungary and Slovakia have been slow to reduce Russian fossil fuel reliance. India argues this inconsistency makes Western criticism unfair.