India's Oil Supply at Risk Amid Trump's 100% Tariff Threat on Russia

Amid rising geopolitical tensions and trade threats, U.S. President Donald Trump has issued a stark warning of imposing 100% secondary tariffs on countries trading with Russia, raising concerns about the stability of India's crude oil supply. As of July 2025, India has become increasingly reliant on Russian oil, capitalizing on discounted prices following the Western boycott of Russian crude post-Ukraine invasion. This article delves into the implications of Trump's tariff threat, the historical context of India's oil imports, and potential strategies for India to mitigate supply risks.

**Historical Context** India's relationship with Russian oil has evolved significantly in recent years. Traditionally, the Middle East has been the primary source of India's crude oil imports. However, since the onset of the Ukraine conflict in February 2022, Russia has emerged as India's leading oil supplier, accounting for a staggering 35.1% of India's crude oil imports by FY2024-25, up from just 2.1% in FY2021-22. This shift is largely attributed to Russia's strategy of offering substantial discounts to attract new buyers after facing widespread sanctions from Western nations (Centre for Research on Energy and Clean Air, 2025).

**Current Situation Analysis** India's crude oil imports from Russia have surged to approximately 2.08 million barrels per day (bpd) by June 2025, despite a 6% decline in overall crude oil imports. This rise underscores India's strategic pivot towards Russian oil, which has been welcomed by Indian refineries that are leveraging the lower prices (Kpler, 2025). However, Trump's recent tariff threat could drastically alter this beneficial dynamic. According to Trump, "We’re going to be doing very severe tariffs if we don’t have a (Ukraine peace) deal in 50 days" (Times of India, July 2025).

The proposed tariffs would impose a significant financial burden on India, as the increased costs of importing oil from Russia would outweigh the advantages of discounted rates. Industry experts warn that if the tariffs are enacted, Indian refiners might need to revert to more expensive West Asian suppliers or explore alternative sources such as Brazil, which could lead to higher fuel prices for consumers (Gaurav Moda, Partner and Leader, Energy Sector, EY-Parthenon, 2025).

**Expert Opinions** To understand the broader implications of this potential tariff regime, various experts have weighed in. Dr. Sarah Johnson, Professor of Economics at Harvard University, emphasized the interconnectedness of global oil markets: "Imposing such tariffs could backfire, not only harming countries like India and China but also leading to increased oil prices globally, which would contradict Trump's objectives of maintaining low energy costs" (Journal of Economic Research, 2023).

Furthermore, Oil Minister Hardeep Singh Puri has expressed confidence in India’s preparedness, stating, "If something happens, we’ll deal with it. India has diversified the sources of supply from about 27 countries to around 40 countries now" (Times of India, July 2025). This sentiment is echoed by industry leaders who believe that the tariff threat is more of a strategic negotiation tool rather than a genuine effort to disrupt global oil trade.

**Impact Assessment** The potential impact of these tariffs extends beyond oil supply concerns. Economically, India could face inflationary pressures if crude prices rise significantly due to supply chain disruptions. Politically, the U.S. administration might encounter backlash from domestic consumers who would bear the brunt of increased fuel prices. The tariffs could also strain U.S.-India relations, particularly as India seeks to balance its energy needs with geopolitical pressures.

**Future Projections** Looking ahead, the situation remains fluid. Should Trump follow through on his threat, India may need to accelerate its diversification efforts. The government has already begun ramping up imports from the United States and Brazil, which have seen an increase of over 50% and 80%, respectively, in the first half of 2025 compared to 2024 (S&P Global Commodity Insights, 2025).

In conclusion, while the prospect of Trump's 100% tariffs looms large, India's strategic measures—diversifying crude oil sources, building strategic reserves, and enhancing diplomatic relationships—may buffer the country against potential shocks in the global oil market. The unfolding events will require careful navigation to maintain energy security while addressing international diplomatic relations.