India, a large importer of crude oil from Russia, may have to watch out for a new US bill which proposes imposing a 500% tariff on countries that import from Russia. In an interview with ABC News, Senator Lindsey Graham said that he wanted the US to impose tariffs to stop them from supporting Vladimir Putin’s war machine. Moscow launched full-scale invasion of Ukraine three years ago on February 24, 2022. “Big breakthrough here. So what does this bill do? If you’re buying products from Russia and you’re not helping Ukraine, then there’s a 500 percent tariff on your products coming into the United States. India and China buy 70 percent of Putin’s oil. They keep his war machine going. My bill has 84 co-sponsors. It would allow the president to put tariffs on China and India and other countries to get them — stop them from supporting Putin’s war machine, to get him to the table. For the first time yesterday, the president told me,” Graham said.Also read: ‘Economic bunker buster for India, China’: How this US senator’s Russia sanctions bill would prove ‘bone crushing’ for trade- if passedGraham has actively been advocating for the legislation, cautioning that it would serve as an “economic bunker buster” for nations such as India and China, which have substantially enhanced their imports of Russian petroleum products.
What’s the 500% tariff threat about?
- The proposed sanctions legislation, which has garnered support from 84 co-sponsors as noted by Graham, seeks to exert pressure on nations such as India and China to cease purchasing Russian oil and commodities. The objective is to diminish Moscow’s wartime economy and compel Russian President Vladimir Putin to engage in negotiations regarding Ukraine, whilst providing Trump with necessary authority.
- The bill, first introduced in March, is anticipated to advance in August. This initiative aligns with the United States’ intensified measures to impose stricter economic restrictions on Russia, as Trump attempts to persuade Putin towards diplomatic discussions amidst the ongoing Ukraine conflict.
- The Senate postponed introducing the legislation following the White House’s resistance to broadening sanctions during Trump’s endeavours to improve relations with the Russian leader. Nevertheless, the administration now appears prepared to endorse these restrictive measures.
How will it impact India?
India significantly altered its oil procurement patterns after Russia’s Ukraine invasion in February 2022. The country transitioned from its traditional Middle Eastern suppliers to Russian oil sources, capitalising on favourable prices resulting from Western sanctions and European embargoes. Russian oil deliveries to India stood at 1.96 million barrels per day (bpd) in May.The transformation in India’s oil import strategy has been remarkable, with Russian oil’s share increasing from less than 1 per cent to roughly 40-44 per cent of total crude purchases in a short period.Also Read | India laps up discounted crude: RIL, Nayara Energy get big chunk of Russia’s flagship oil exports; Reliance world’s single biggest buyer of UralsIndia’s Russian oil imports reached new heights in June, surpassing combined imports from Saudi Arabia and Iraq, during a period of market uncertainty following Israel’s major offensive against Iran.As the world’s third-largest oil importer and consumer, India has secured roughly 5.1 million barrels of international crude oil, which its refineries convert into various fuel products including petrol and diesel.“According to preliminary analysis by global trade analytics firm Kpler quoted in a PTI report, Indian refiners are expected to purchase 2-2.2 million barrels per day of Russian crude oil in June, reaching a two-year peak and exceeding the total quantities acquired from Iraq, Saudi Arabia, the UAE and Kuwait.”India has also become the primary recipient of Russian Urals oil grade transported by sea in 2025, receiving 80% of the total exports. The country’s two private refineries have substantially boosted their imports of this lower-priced crude.According to Kpler statistics referenced in a Bloomberg report, India acquired 231 million barrels of Urals through June 24, with Reliance Industries Ltd. and Nayara Energy Ltd. jointly obtaining 45% of Russia’s exports of this medium-sour grade.The proportion of Urals purchases by these two private Indian refiners has steadily increased in recent years, particularly in 2025. Reliance has positioned itself as the world’s largest buyer of Urals, having purchased 77 million barrels in the current year.Hence, a 500% tariff on countries importing oil from Russia may impact India very badly. Incidentally, India has also stepped up oil imports from America. United States crude oil exports to India saw a substantial rise, reaching 439,000 barrels per day in June, marking a notable increase from the 280,000 barrels per day recorded in May.
Will Trump really sign the 500% tariff order?
Graham has clarified that Trump would retain discretionary power through a waiver provision, enabling him to decide on the bill’s implementation should it successfully pass through Congress.“I was playing with him (Trump). He says, “It’s time to move — move your bill. There’s a waiver in the bill, Mr. President. You’re in charge whether or not it’s to be implemented.” But we’re going to give President Trump a tool in the toolbox he doesn’t have today. After the July break, we’re going to pass a bill that with allow the president,” Graham elaborated.Also Read | ‘Highest in two years’: India increases oil imports from Russia, US amidst Iran-Israel war; why it’s about strategic positioning, not panic
Russia’s Response to The Bill
The Kremlin’s official spokesperson, Dmitry Peskov, addressed the remarks made by Graham on Monday, acknowledging that Russia had been monitoring the US senator’s position and had noted his recent declaration.“The senator’s views are well known to us, they are well known to the whole world. He belongs to a group of inveterate Russophobes. If it were up to him, these sanctions would have been imposed long ago,” said Peskov.Peskov further questioned the effectiveness of such measures by stating, “Would that have helped the (Ukraine) settlement (process)? That is a question that those who initiate such events should ask themselves.”
