The US decision to waive sanctions, restrictions and duties on Russian oil and gas removes an immediate threat to Russian oil imports to India, but it does not restore certainty to India’s energy supply chain. The waiver prevents tariffs of up to 100% from being applied under a new US law, while Indian refiners still face tighter Russian supplies, stronger Chinese demand and disruption in the Middle East.
US President Donald Trump announced the waiver in an executive order issued on Friday evening, days before several provisions of the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 were due to take effect. According to the order, Trump certified to Congress that suspending the sanctions, restrictions and duties was in the national interest of the United States.
The legislation had authorised broad sanctions on Russia and steep tariffs on major buyers of Russian oil and gas, including India and China. The law provided for tariffs of up to 100% within 30 days on goods entering the US from the five largest importers of Russian crude oil or gas. It also covered countries that knowingly bought Russian oil or gas after the law’s enactment, as well as countries among the five largest alleged to be helping Russia evade sanctions.
For India, the decision changes the immediate financial risk attached to importing Russian crude. Russia remains India’s largest oil supplier, and a tariff of up to 100% could have affected Indian exporters because the United States is India’s largest trading partner. Sanctions that made Russian crude uneconomic would also have forced refiners to seek replacement supplies at a time when Middle East shipments were facing disruption.
That combination explains why the waiver matters beyond the legal status of one category of oil cargoes. India’s energy system depends on the ability of refiners to combine supplies from different regions and adjust quickly when prices, shipping routes or sanctions change. Russian crude has provided a large source of supply since the start of Moscow’s war with Ukraine, when European sanctions pushed Russia to sell more oil to India and China at deep discounts.
The arrangement has not been static. The Times of India report said that the United States imposed a 25% penal tariff on India last year for buying Russian crude, taking the total tariff burden to 50%. India continued purchasing Russian oil, although imports began declining after Washington sanctioned two Russian oil majors. In February, when the US lowered tariffs on India to 18% and removed the 25% penal tariff, Trump claimed that India would stop buying Russian oil. India, however, did not make such a statement, according to the report.
The waiver therefore does not mark a complete return to the conditions that made Russian crude especially attractive. It removes a major prospective penalty, but commercial decisions will still depend on the price of Russian cargoes, freight costs, insurance, payment arrangements and the availability of alternative supplies. The supplied report does not establish how long the waiver will remain in force or whether additional restrictions could be introduced later.
The immediate energy context is also more difficult than it was when Russian crude first became a major part of India’s import basket. The Middle East is a significant supplier of India’s crude oil, liquefied petroleum gas and liquefied natural gas. The report said shipments through the Strait of Hormuz had been hit, prompting India to diversify its energy basket more aggressively. Russian oil has consequently played a larger role in meeting India’s requirements during a period of disruption.
The central change in the market may now come from China rather than Washington. Indian refiners expect Russian crude supplies to become tighter in October and November as exports decline and Chinese competition increases, the report said. China, the world’s largest crude importer, has increased purchases as conflict in the Middle East disrupted supplies. The resulting competition could push Indian refiners towards more expensive alternatives for the remainder of the year.
A source involved in selling Russian crude told Reuters, as cited in the report, that Chinese buyers were booking cargoes in advance and paying firmer prices than Indian refiners. This points to an important distinction between regulatory relief and physical access. Even when the US does not impose the threatened tariffs, India may still have to pay more or accept less favourable commercial terms to secure Russian barrels.
The report also cited Kpler data indicating that Russian oil supplies in October were recovering and averaging above 2 million barrels per day. That figure suggests that supply has not simply disappeared, but it does not resolve the allocation problem facing buyers. If China books more cargoes in advance and competes aggressively for available shipments, Indian refiners may have fewer opportunities to capture discounted Russian crude.
For Indian cities and households, the effects of this competition are likely to be transmitted through the wider energy and logistics system rather than through one direct policy channel. Refinery input costs influence the economics of transport fuels, petrochemical production and industrial supply chains. Shipping disruption and more expensive replacement crude can add pressure to costs across an economy that depends heavily on imported oil. The supplied material does not quantify the impact on retail fuel prices or household expenses, so those effects cannot be established from the waiver alone.
The institutional chain behind the decision is equally significant. The US Congress created the authority through the Graham Act, while the US president used an executive order and a certification of national interest to waive its application. India’s exposure is shaped by decisions taken across several systems: American sanctions policy, Russian export availability, Chinese procurement, Indian refinery demand and the security of maritime routes through the Middle East.
The move may also have implications for India-US trade negotiations. The report said the US decision to sign the sanctions bill had been viewed as a factor weighing on talks, while Commerce Minister Piyush Goyal had recently indicated that a draft trade agreement was almost ready. With the sanctions now waived, the immediate pressure on the negotiations may ease, although the report does not establish whether the waiver was linked to the talks or whether it will produce a specific outcome.
The larger policy issue is India’s exposure to supply concentration during geopolitical crises. Russian crude helped India respond when European sanctions reshaped the market, while Middle East disruptions have increased the importance of maintaining multiple sources of supply. But diversification is not only a question of the number of supplier countries. It also depends on shipping access, refinery compatibility, payment systems, insurance, price discounts and the ability to withstand sudden changes in foreign policy.
The waiver offers India time, not certainty. It prevents the threatened US tariff escalation from immediately making Russian crude uneconomic and reduces one major risk for exporters connected to the US market. Yet the physical oil market remains competitive, and China’s willingness to secure Russian cargoes in advance could weaken India’s bargaining position. The next developments to monitor are the duration of the US waiver, Russian export volumes, Chinese purchasing behaviour, the security of Middle East shipping routes and the progress of India-US trade negotiations.
