Trump’s 100% Russian oil tariff U-turn has a catch India can’t ignore

US President Donald Trump’s decision to waive threatened tariffs of up to 100% on countries buying Russian oil offers India temporary relief but leaves New Delhi exposed to renewed pressure from Washington, the Global Trade Research Initiative (GTRI) said on Saturday.

The think tank said the waiver could be withdrawn at any time, allowing the US to revive the tariff threat and use it as leverage in bilateral trade negotiations. It urged India to protect its energy security, purchase oil on commercial terms and avoid making permanent trade concessions in return for temporary relief.

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“For India, the waiver buys time but offers no lasting certainty. India should protect its energy security, buy oil on commercial terms and prepare for renewed US pressure. Temporary tariff relief is no basis for permanent trade concessions,” GTRI founder Ajay Srivastava said.

Trump issued the waiver on October 16 under the newly enacted Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 (SRIA), which provides for punitive tariffs against Russia and major buyers of its oil. The move came weeks after the legislation became law on September 18.

GTRI said the reversal highlights the uncertainty in US trade policy, with Washington threatening penalties but stepping back when enforcing them conflicts with its own economic or diplomatic interests.

“The waiver exposes the uncertainty at the heart of US trade policy: Washington threatens penalties, then retreats when enforcing them becomes inconvenient,” the think tank said.

Why the US may have stepped back

GTRI identified Washington’s own energy requirements, its tariff truce with China and the risk of derailing trade negotiations with India as possible reasons for the waiver.

Under an October 9 agreement with Russia, the US decided to buy Russian diesel to address domestic shortages and high fuel prices. Penalising other countries for purchasing Russian energy while buying it itself could invite accusations of double standards, the think tank said.

Washington has also agreed to hold off on tariff increases against China until January 10 under an arrangement reached during Chinese President Xi Jinping’s visit to the US last month.

With China shielded from fresh tariff action and the US itself buying Russian diesel, imposing additional duties on India could complicate ongoing bilateral trade negotiations, GTRI said.

“China already had protection against US tariff increases until January 10. The message is clear - US interests determine when penalties apply, while the ability to retaliate helps secure protection. China can push back. India risks repeated pressure unless it demonstrates that coercion carries a cost,” Srivastava said.

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What the waiver means for India

The relief does not remove the underlying tariff threat. According to GTRI, the executive order puts the penalties under the Graham Act on hold by invoking Section 115, which allows the duties to be waived. The waiver has no fixed expiry date, but Washington can withdraw it.

The framework provides for a 500% tariff increase on Russian goods and additional duties of 100% on goods from major buyers of Russian oil making new purchases from October 18, 2026. The US Trade Representative will continue monitoring Russian energy purchases, leaving Washington with the option of reviewing the waiver and restoring the threat, GTRI said.

The think tank also pointed to a shift in India’s oil sourcing. Russia’s share of India’s oil imports fell from 51% in July to 44% in August as purchases shifted towards the US, despite higher prices, and the United Arab Emirates.

GTRI said India should not treat the waiver as a durable change in US policy or make long-term energy decisions around relief that can be reversed. Instead, New Delhi should retain flexibility in its oil purchases and prepare for the possibility of renewed American pressure.