Oil executives brush aside Trump’s tariff threat on Russian crude

New Delhi: Indian refinery executives see US President Donald Trump’s threat to impose 100% secondary tariffs on Russia as a negotiating tactic, with little real-world implication for global oil markets or India’s imports of Russian crude.

The oil market barely reacted to Trump’s assertion on Tuesday, with Brent trading around $69 per barrel, similar to levels seen over the past week.

Refinery executives said if implemented, the proposed tariff could effectively shut Russia out of the global oil market, pushing prices to $120 per barrel or more, derailing Trump’s own low-energy-price agenda and fuelling global inflation. Russia exports about 4.5–5.0 million barrels per day (mbd) of crude oil, roughly 5% of total global demand. In addition, it exports about 2 mbd of refined products.


Conversely, if India and China were targeted with 100% tariffs for continuing to buy Russian oil, the resulting spike in US import costs from these countries could burden American consumers and prove politically difficult for Trump to manage, executives said.

“This whole tariff game is about Trump trying to strike deals with countries, including Russia, not about disrupting energy trade or dealing with high inflation at home,” an executive said.

Another executive said Trump’s warning was just a ploy to induce seriousness in negotiations with Russia, whose leader Vladimir Putin has been following a dual-track strategy—engaging with Trump over the phone and talking of a peace deal, while simultaneously hammering Ukraine with an increasing barrage of missiles and drones.

“We’re very, very unhappy with (Russia). And we’re going to be doing very severe tariffs if we don’t have a (Ukraine peace) deal in 50 days. Tariffs at about 100%, you’d call them secondary tariffs,” Trump said on Monday.

Secondary tariffs mean that countries engaged in trade with Russia would face a 100% tariff when exporting goods to the US. India and China are the top two buyers of Russian oil.

India stopped buying oil from Iran in 2019 after Trump, during his previous term as president, threatened secondary sanctions on buyers of Iranian oil. China, however, continues to do so with impunity.