Why India Can't Walk Away From Russian Crude, Even With the Threat of U.S. Tariffs

When you hear talk of the United States dangling steep tariffs – up to a full 100 % – on countries that buy Russian oil, the first reaction is often, “Let’s quit the Russian market.” The Global Trade Research Initiative (GTRI) says that’s a risky, short‑sighted move for New Delhi.

According to the GTRI’s latest study, India’s energy security should stay the top priority. The report argues that swapping away Russian crude for a temporary pat on the back from Washington could end up costing far more in the long run – not just in higher prices but also in strategic vulnerability.

Remember, India imports about 88 % of the oil it needs. In July 2026 alone, the country spent roughly $7.27 billion on Russian crude, which was almost half of all its oil imports that month. That means Russia supplied more oil than the UAE, Saudi Arabia, Venezuela, Brazil, Oman and even the United States combined.

The shift toward Russian barrels didn’t happen overnight. Up until 2022, the Gulf states accounted for over half of India’s oil basket while Russia was a modest 15 % or less. As the West‑Asia crisis tightened supply routes, New Delhi turned to Russia, and the share of Gulf oil fell to under 30 %.

Why does this matter now? The U.S. House just passed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, giving the president authority to slap on a 100 % tariff on goods from the five biggest buyers of Russian oil and gas – India and China are on that list. While the legislation is still being fleshed out, the threat is real.

The GTRI warns that trading away energy security for “temporary tariff relief” is a false bargain. A trade pact or a pause in Russian oil purchases won’t shield India from future Section 301 investigations or other unilateral U.S. trade actions. In fact, Washington could use the looming tariffs as leverage to force a broader concession from New Delhi.

Interestingly, the report points out that India may actually feel more pressure than China, even though China buys more Russian oil overall. Back in July 2025, the United States imposed a 25 % Russia‑related tariff on Indian goods – a measure that was later withdrawn in February 2026 – while Chinese exports were largely untouched.

What’s the bottom line? As long as Russian crude remains competitively priced, the GTRI says India should keep buying it. Discounted Russian oil has helped shave off a chunk of the import bill, bolstered energy security and kept inflation in check.

That doesn’t mean India should sit back and do nothing. The report urges New Delhi to negotiate firmly with Washington, but without handing over unilateral trade concessions that could jeopardise its own energy roadmap.

Only once the United States finalises the exact tariff rates, product coverage and timeline will the real impact on Indian exports become clear. Until then, the safest bet – according to the GTRI – is to let market economics, not political pressure, guide India’s oil policy.