Kathrine Frich
Other countries are also navigating the fallout.
When a global power rewrites the rules of trade, the shockwaves travel fast.
For countries relying heavily on imported fuel to run their economies, a new law in Washington is suddenly forcing a massive rethink.
The threat of tariffs
Indian refineries are scrambling to scale back their orders of Russian crude oil. The shift follows US President Donald Trump signing a tough new sanctions package into law last week.
The legislation lets the White House hit the biggest buyers of Russian energy with sweeping tariffs of up to 100 percent. The penalties target nations whose Russian supplies exceed 15 percent of their energy imports.
Both India and China meet that criteria, according to United24Media. Before this pressure, Moscow supplied just over half of India’s oil imports, helping New Delhi ride out supply disruptions from the Middle East.
Searching for alternatives
The chill is already being felt at the ports. September deliveries of Russian oil are on track to hit 1.9 million barrels per day, marking the lowest point since April, Kpler data shows.
As Indian buyers negotiate contracts for November, they are actively looking for other suppliers. But replacing the sheer volume that Russia provides is no small task.
Sources from Venezuela or Iran cannot meet the massive demand, while Middle Eastern crude remains noticeably more expensive. Last week, Russian Urals crude delivered to India cost $133 per barrel, remaining cheaper than options like Oman and Murban.
The timing is tricky because India’s domestic oil needs are growing. A new refinery in Rajasthan and other expansions could push the country’s daily purchases to a record 5.4 million barrels.
Pushing back on pressure
Not everyone believes the country should bend to Washington’s demands. Some experts argue that the government must prioritize its own economic stability.
Ajay Srivastava, founder of the Global Trade Research Initiative, offered a blunt assessment. “India should continue to buy oil from Russia as long as it remains competitive,” he said.
“India should ignore US threats to introduce tariffs, as there is no end to them,” Srivastava added. “The US may soon come up with new ways to introduce additional tariffs.”
Other countries are also navigating the fallout. Hungary previously secured a one-year exemption under former Prime Minister Viktor Orbán, but the country’s new government must now negotiate its own deal.
Sources: UNITED24 Media, Bloomberg, Kpler
