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Trump-Modi Russia Oil Tariff Dispute: Can India and US Resolve the Trade Fight?

Дата публикации: 12-08-2026 09:59:51

A new Senate bill threatens 100% tariffs on Russian oil buyers like India, testing February's Trump-Modi trade deal as the two leaders look to resolve the dispute directly.

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A new Senate bill authorizing tariffs of up to 100% on major buyers of Russian oil, including India, has revived tension between the U.S. and India over New Delhi's energy purchases just months after President Donald Trump and Indian Prime Minister Narendra Modi struck a deal to lower trade barriers between the two countries.

The Senate passed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 on Aug. 7 in an 86-11 vote, sending it to the House, where a vote is not expected before September, according to CBS News and Al Jazeera.

White House trade adviser Peter Navarro said Trump and Modi would personally work out the dispute over Russian oil purchases, even as the legislation adds a new layer of pressure atop a February agreement in which Trump said Modi had agreed to stop buying Russian crude, a commitment Modi never explicitly confirmed.

How the Dispute Evolved: A Timeline

The tension dates back to more than a year ago. In August 2025, Trump imposed an additional 25% tariff on Indian goods specifically to pressure New Delhi over its Russian oil purchases, stacking on top of an existing 25% "reciprocal" tariff for a combined 50% rate, one of the highest the US imposed on any trading partner, according to CNN and CNBC.

In October 2025, Trump told reporters Modi had personally assured him India would stop buying Russian oil, adding that he would next press China to do the same, according to Al Jazeera.

By January 2026, Trump was signaling frustration that the purchases had continued, telling reporters aboard Air Force One that tariffs could rise again if India did not curb its Russian oil imports, according to the Deccan Herald.

On Feb. 2, 2026, Trump announced a trade deal after a phone call with Modi, cutting the tariff rate on Indian goods to 18% from 25%, in exchange for India lowering its own trade barriers, purchasing more than $500 billion in US goods, and shifting away from Russian crude toward American and Venezuelan oil, according to CBS News and Al Jazeera.

Modi confirmed the reduced tariff rate in a post on X but did not explicitly confirm the commitment to stop buying Russian oil, according to CNN and Al Jazeera.

Despite the February agreement, India continued to import roughly 1.5 million barrels of Russian oil per day months later, according to trade data from Kpler cited by CNN. Russian oil made up more than a third of India's overall oil imports at the time, and Russian crude has traded at a discount of roughly $16 a barrel compared with OPEC or US crude, making a full switch difficult, according to CNN.

The Supreme Court Complication

In late February 2026, the US Supreme Court ruled against Trump's use of certain emergency tariff powers, a decision analysts said would likely allow India to keep buying Russian oil with fewer consequences, since it constrained the legal tools Trump had been using to enforce tariff threats, according to CNBC.

That ruling appears to be part of why lawmakers pursued the new sanctions bill: Some Senate Democrats who opposed the legislation argued it effectively hands Trump renewed tariff authority that the courts had just curtailed, according to The Hill.

What the New Senate Bill Does

The bill, named in honor of Sen. Lindsey Graham, R-SC, who died unexpectedly last month, passed the Senate 86-11 after Graham's funeral, which Ukrainian President Volodymyr Zelenskyy attended, according to CBS News and ABC News.

It authorizes the president to impose tariffs of up to 100% on the top five global purchasers of Russian oil or natural gas, a group that includes India and China, with exceptions for countries importing less than 15% of their natural gas from Russia while taking significant steps to reduce those imports, according to CBS News.

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