India must not let energy security become a US trade ‘weapon’, warns GTRI
The Global Trade Research Initiative (GTRI), a trade policy think tank, warned that newly passed US sanctions legislation effectively turns tariff policy into a tool for pressuring India's energy sourcing decisions
The legislation permits tariffs of up to 100% on goods from the largest buyers of Russian crude oil and natural gas, a group that includes India
GTRI noted that India imports more than 88% of its crude oil requirements and that Russian crude accounted for a majority share of India's total crude imports by value in a recent month
The think tank recommended that India continue purchasing Russian oil as long as it remains commercially competitive, and avoid granting unilateral trade concessions merely to secure tariff relief
India's crude oil import dependency and post-2022 sourcing shift
India is structurally import-dependent for crude oil, importing over 88% of its requirement to meet domestic refining and consumption needs. Since April 2022, the sourcing mix has shifted dramatically as steep discounts on Russian Urals crude, following Western sanctions on Russia, pulled Indian refiners toward Russian supply in place of traditional West Asian and African sources.
Key Details
- Russia's share in India's crude import basket was around 2% or less before the 2022 Ukraine conflict, rising to roughly 20% in FY2022-23 and around 35-36% in FY2023-24 and FY2024-25
- In July 2026, Russian crude alone accounted for 51.1% of India's total crude oil imports by value ($7.27 billion of $14.21 billion), reflecting continued reliance despite the tariff threat
- Iraq, Saudi Arabia, the UAE, and the United States remain India's other major crude suppliers, alongside Russia, as part of a diversified sourcing strategy
- The Ministry of Petroleum and Natural Gas coordinates crude sourcing policy, while India also maintains Strategic Petroleum Reserves (at Vishakhapatnam, Mangalore, and Padur) as a buffer against supply disruptions
GTRI's warning centres precisely on this dependency: because India cannot easily substitute 35-50% of its crude basket overnight, using tariffs to force a sourcing shift away from Russian oil directly threatens the country's energy security rather than merely its trade balance.
Trade remedy laws beyond sanctions: Section 301 and Section 232 as recurring risk
GTRI's caution that "neither signing a trade agreement nor stopping Russian oil purchases" can fully insulate India from future US trade action points to two other standing US trade-remedy tools — Section 301 of the Trade Act, 1974, and Section 232 of the Trade Expansion Act, 1962 — that operate independently of sanctions legislation and could be invoked again regardless of any near-term settlement.
Key Details
- Section 301 (Trade Act, 1974) empowers the US Trade Representative to investigate and retaliate against a foreign country's "unfair," "unreasonable," or discriminatory trade practices, following an investigation and hearings process
- Section 232 (Trade Expansion Act, 1962) allows tariffs when the US Commerce Department determines that a category of imports threatens national security, with the President given 90 days to decide on action after the investigation
- These differ from the sanctions-based tariff route used against Russian oil buyers, which flows from Congressional sanctions legislation rather than a Commerce Department or USTR investigation
- Because Sections 301 and 232 are separate, standing statutory authorities (unlike the now-invalidated IEEPA route), the US retains multiple independent legal avenues to impose tariffs on India even after any Russian-oil-specific dispute is resolved
GTRI's recommendation against unilateral concessions rests on the fact that a bilateral trade deal addressing the Russian-oil tariff issue would not shield India from separate Section 301 or Section 232 actions in future, since these operate on entirely different legal triggers.
- India's crude oil import dependency: over 88% of domestic requirement met via imports
- Russia's share of India's crude imports: roughly 2% pre-2022, approximately 35-36% in FY2023-24 and FY2024-25, and 51.1% by value in July 2026
- Tariff ceiling under the new US sanctions legislation: up to 100% on the top buyers of Russian crude oil and natural gas
- GTRI (Global Trade Research Initiative) is an independent Indian trade policy think tank frequently cited on tariff and trade-agreement analysis