Trump’s Claim That “Russia Lost Oil Client India” — And The Fresh Tariff Warning
Short Summary
U.S. President Donald Trump said Russia had “lost” India as an oil client and suggested he may hold off on a planned 25% secondary tariff linked to Russian oil trade that’s slated to kick in on August 27. The comments came days after Washington announced a separate additional 25% duty on Indian goods (on top of an existing 25%), effectively doubling many rates to 50%. New Delhi has not confirmed any halt in Russian oil purchases; India’s state refiners and officials signal buying continues on economic grounds, and recent data shows Indian imports of Russian crude remain substantial. Markets view the mixed messages as more uncertainty than clarity.
Introduction:
When a U.S. president says your country has “quit” a major oil supplier, that’s the kind of line that ricochets across trading floors, cabinet rooms, and newsrooms. That’s exactly what happened when President Donald Trump declared Russia had lost India as an oil client—and, in almost the same breath, floated that he might not impose a new 25% tariff scheduled to bite on August 27. The twist? India has not announced any freeze on Russian crude. In fact, refiners say buying decisions still hinge on price and logistics, not politics. Meanwhile, the U.S. has already slapped an additional 25% duty on many Indian goods (stacked over an existing 25%), pushing effective rates to 50% in several categories.
So we’re left with three big questions:
- What exactly did Washington announce—and what’s merely being threatened?
- Is India really out of the Russian oil market—or is that claim off the mark?
- What do these headlines mean for prices at the pump, trade flows, and strategy in New Delhi, Washington, and Moscow?
Let’s break this down step by step, cut through the noise, and focus on the moving parts that actually change business decisions.
What Was Said (And When)
- Trump’s on-record claim: Russia “lost an oil client … India,” paired with a warning that a 25% secondary tariff could be “devastating,” but he “may not have to do it.” He tied this to India once representing “about 40% of the oil,” a shorthand reference to India’s large share of Russia’s redirected seaborne crude after Europe cut back.
- Tariff layers to understand:
- Layer A — Already announced: The U.S. announced an additional 25% duty on Indian goods, on top of an existing 25% base in many lines, effectively taking some rates to 50%. This is framed as a penalty for India’s continued Russian oil purchases.
- Layer B — Possible next step: A separate 25% secondary tariff targeting deals tied to Russian oil (including India’s purchases) slated to kick in August 27, which Trump now says he may hold off on. Think of this as a lever Washington could pull—or not—depending on policy and negotiations.
The upshot: one tariff layer is live (the add‑on that pushes many lines to ~50%); another is looming (the secondary tariff) and now… maybe not. That’s exactly the kind of ambiguity that makes risk managers earn their coffee.
What India Is Actually Doing On Oil (Spoiler: Still Buying, With Adjustments)
Let’s go beyond podium quotes and look at barrels.
- Recent trade pulse: Indian refiners have not declared a halt. State-run and private players continue to weigh discounts on Russian grades (Urals, ESPO, etc.) against freight, insurance, and compliance frictions. Recent reporting shows enquiries picked up as discounts widened again, even if state refiners briefly paused when margins tightened.
- First-half 2025 numbers: India took roughly 1.75 million barrels per day of Russian oil in Jan–Jun 2025, marginally up year-on-year, underscoring that the Russia–India oil corridor is very much alive.
- Earlier in 2025: Imports from Russia climbed to a 10‑month high near 1.8 million bpd in May as refiners snapped up lighter grades.
Add that up and Trump’s “lost client” line doesn’t match the import reality on the ground. India’s purchases ebb and flow with price and policy noise, but they haven’t vanished. If anything, the pattern is: pause when discounts shrink; resume when they widen—classic commodity logic
The Tariff Timeline—What’s In Force vs. What’s “On Deck”
- In force now: The additional 25% duty on Indian goods (stacked over an existing 25% in many lines) that pushes some effective rates to 50%. This is already rattling exporters in apparel, leather, and select manufactured goods.
- On deck (Aug 27): A 25% secondary tariff explicitly linked to Russian oil purchases—threatened, not yet inevitable. Trump now says he may not impose it, keeping the door open for carrots-and-sticks diplomacy.
Meanwhile, the White House has telegraphed a broader architecture to pressure buyers of Russian energy—China included—though on China specifically, Trump just said there are no imminent plans to penalize, hinting at a wait-and-see approach after the Alaska meeting.
What Indian Officials and Refiners Are Signalling
- New Delhi’s stance: India buys where it’s economical and lawful; Russian crude has moderated India’s import bill and, by extension, domestic inflation. Officials have consistently argued that energy security trumps politics.
- Refiners’ calculus: If discounts widen and logistics are smoother, Russian barrels stay attractive; if freight/insurance or payment risks rise, refiners pivot to the Middle East, U.S., West Africa, or Brazil. State-run companies reportedly paused when discounts narrowed, then re‑engaged as price gaps improved
- The data backdrop: India still imported ~1.75 mbpd of Russian crude in H1 2025 and approached 1.8 mbpd in May, with private refiners taking meaningful volumes
FAQs
1) Did India actually stop buying Russian oil after the U.S. tariff announcements?
No formal halt was announced by New Delhi. H1‑2025 data shows Indian imports of Russian crude around 1.75 mbpd, with May near 1.8 mbpd as discounts improved. Refiners adjust volumes based on price, freight, and compliance—not presidential sound bites
2) What’s the difference between the “extra 25% duty” and the “secondary 25% tariff”?
The extra 25% duty (on top of an existing 25%) is already in effect on many Indian goods, pushing some rates to ~50%. The secondary 25% tariff is a planned, Russia‑oil‑linked measure slated for Aug 27—which Trump now says he may not impose. Think: in force versus on deck.
3) If the Aug 27 tariff hits, will Indian refiners stop buying Russian crude?
Not necessarily. Expect re‑pricing and re‑routing first—Moscow could widen discounts to preserve flows. But compliance and payment friction would rise, so some barrels likely shift to the Middle East, U.S., or West Africa
4) How did the Trump–Putin Alaska meeting influence this?
The summit produced no ceasefire and no sanctions relief—lots of optics, light on deliverables. That keeps Washington leaning on tariff threats and Moscow leaning on discounts, leaving India to hedge.
5) Why does India keep buying Russian oil despite U.S. pressure?
Because it’s cheap enough to matter for inflation and the trade balance, and because purchases remain within India’s reading of applicable rules and price‑cap norms. As one official line goes: India buys on economic considerations.
