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Trump threatens India with ‘penalty’ over Russian oil imports

Jul 31, 2025, 7:32am EDT
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A worker stands at a fuel station of Nayara Energy on the outskirts of Ahmedabad, India
Amit Dave/Reuters

US President Donald Trump threatened to impose an unspecified penalty on India on top of a 25% economy-wide tariff because of the country’s imports of Russian oil, sending Indian refineries scrambling for alternative sources.

Trump had previously threatened that buyers of Russian energy could face tariffs of up to 100%. Oil prices jumped following the remarks, because finding a replacement for Russian crude at the volumes India now imports would strain the market.

Since Russia’s 2022 invasion of Ukraine and the raft of energy sanctions that followed from the US and Europe, India has taken advantage of discounted Russian oil and now relies on it for one-third of its refineries, according to Rystad Energy. Some of those refineries were hit with additional sanctions from the European Union last week. The increasingly complex web of restrictions is a win for India’s energy traders, who are poised to profit by finding new sources of crude oil, and new customers for refined oil products.

A chart showing India’s oil imports by country of origin.
AD