The cost of buying Russian oil: A new US bill could hit India with 100% tariffs

Washington DC: A bipartisan group of US senators has unveiled a new sanctions bill that could impose tariffs of up to 100% on exports from India, China, Slovakia, Hungary and Azerbaijan for purchasing Russian oil.

The proposed legislation, backed by the White House, is designed to reduce Russia's energy revenues and increase economic pressure on Moscow as the war in Ukraine continues.

If approved by Congress, the bill could be passed before August, according to lawmakers supporting the measure.

India among five countries named

Speaking at a press conference in Washington, Senator Richard Blumenthal said the bill specifically targets the world's largest remaining buyers of Russian oil.

"It imposes tariffs that are targeted, narrowly limited to the five major purchasers, up to 100 percent, with waiver authority that is narrowly tailored and constricted."

He identified the countries covered by the proposal as:

• India
• China
• Slovakia
• Hungary
• Azerbaijan

The bill also includes provisions for Russian natural gas buyers but exempts countries purchasing less than 15% of Russia's total gas exports while actively reducing their dependence.

White House backs the proposal

The legislation has received support from the White House, improving its chances of advancing through Congress.

Unlike an earlier proposal introduced in 2025 that sought tariffs of up to 500%, the new bill adopts a narrower and more targeted approach after lawmakers expressed concerns over the previous version's severity.

Democratic Senator Jeanne Shaheen said the revised legislation is designed to be more practical while maintaining pressure on Russia.

US Trade Representative to decide tariff level

Although the bill allows tariffs of up to 100%, the final rate would not be automatic.

According to Senator Blumenthal, the US Trade Representative (USTR) would determine the exact tariff level. "The decision about the exact rate will be determined by the United States Trade Representative. We've had extensive discussions with him."

He added: "I think it will be set at an appropriate level to discourage China, India and other major purchasers of Russian oil and gas."

The legislation also includes reporting requirements if the tariff rate is reduced after implementation.

Bill also expands sanctions on Russia

Beyond tariffs, the proposal introduces broader sanctions targeting Russia's:

• Energy sector
• Defence industry
• Financial institutions
• Industrial sector

Lawmakers said the objective is to reduce Moscow's ability to finance its military operations in Ukraine by restricting revenues from energy exports.

Lindsey Graham remembered for backing sanctions

During the announcement, senators paid tribute to late Senator Lindsey Graham, who died last week.

Graham had been one of the strongest supporters of the earlier Sanctioning Russia Act and played a major role in shaping the new legislation before his death.

What it could mean for India

India has significantly increased imports of discounted Russian crude since the start of the Russia-Ukraine conflict, making Russia one of its largest oil suppliers.

If the bill becomes law, Indian exports to the United States could face tariffs of up to 100%, although the exact rate would depend on the decision of the US Trade Representative and any waiver provisions included in the legislation.

The proposal comes even as India and the United States continue discussions aimed at strengthening economic ties and expanding bilateral trade under the proposed Mission $500 Billion initiative.