India has made some historic strides in 2025 increasing its crude oil imports, buying around 1 billion barrels so far. Russia is the clear number-one supplier of crude oil to India. It contributes a significant 37% of the oil consumed in the country. The Russian invasion of Ukraine exacerbated these concerns, focusing attention on the environmental and equity issues linked to our reliance on Russian oil. Former US President Donald Trump threatened that India’s trade tariffs would go up.
The prevailing geopolitical situation has increasingly boxed India into a corner. Despite all the hoopla, the nation is still addicted to Russian oil. In turn, the US administration has made a concerted effort to re-examine its trade policies. These possible future scenarios have become clearer after Trump recently threatened to increase trade duties on India. This move has been prompted by India’s increased purchases of Russian crude oil.
At present, India has to contend with a pre-existing, analogous 25% tariff on its exports to the US. If new tariffs are enacted, they will be applied on top of this already high and still-growing rate. This development may significantly increase expenses for Indian importers. Consequently, this could affect the net price of oil in the Indian market.
India’s decision to import crude oil from Russia has been more complicated by factors such as pricing and availability. With global oil prices in flux, Indian importers have gone looking for a better deal and found one in Russia’s willingness to provide it. This strategy is no longer a viable diplomatic strategy. Countering Russian influence The United States has traditionally been faster and more willing than the EU itself to use economic tools to curb Russian influence.
In fact, the potential ripple effects of higher trade tariffs could reach far past the energy sector. India’s economy relies heavily on energy imports to fuel its growth, and any increase in costs could impact various industries and lead to inflationary pressures. This would have serious long-term implications for consumers, businesses, and the national economic prosperity.