The new US law targets Russia’s energy revenues and gives President Donald Trump broad authority to penalise major buyers of Russian oil and gas.
US President Donald Trump has signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 into law, creating a new mechanism for imposing tariffs of up to 100% on major buyers of Russian oil and natural gas.
The White House confirmed Trump’s signature on September 18, two days after the US House of Representatives passed the legislation by 262-159. The law expands sanctions against Russia and also extends existing US sanctions on Iran.
The measure puts India and China among the countries exposed to the new tariff authority, given their status as major purchasers of Russian crude. However, the law does not automatically impose a 100% tariff on Indian or Chinese goods. The final decision on whether to impose such duties, and at what rate, rests with the US president under the new law.
Also Read | US Warns India, China Over Russian Oil as Trump Gets 100% Tariff Powers
Trump Signs Sweeping Russia Sanctions Law
The legislation is formally known as the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026.
It was named after the late Republican Senator Lindsey Graham, who had been a prominent supporter of tougher measures against Moscow and died in July 2026. The legislation was co-written with Democratic Senator Richard Blumenthal.
The law is designed to increase economic pressure on Russia by targeting several parts of the country’s economy and international trade network.
Among its provisions are measures targeting:
- Russian government officials
- Russian President Vladimir Putin
- Banks and financial institutions
- Russian energy interests
- Defence-related networks
- Foreign entities supporting Russia’s war effort
- Vessels associated with Russia’s so-called shadow fleet
The legislation also extends existing sanctions relating to Iran.
How the 100% Tariff Provision Works
The most consequential provision for India and China is the authority to impose tariffs of up to 100% on goods from countries that fall within the law’s Russian energy provisions.
Reuters reported that the legislation gives Trump authority to impose tariffs of up to 100% on the five largest buyers of Russian oil or natural gas, as well as countries involved in facilitating sanctions evasion.
That means the immediate legal development is the creation of a powerful new tariff mechanism.
It does not mean that Indian exports to the United States have automatically become subject to a 100% duty.
The actual economic impact will depend on:
- Whether Trump activates the tariff authority.
- Which countries are designated under the law.
- What tariff rate is selected.
- Which products are covered.
- When any new tariffs would take effect.
- Whether exemptions or waivers are granted.
The legislation gives the administration considerable discretion over implementation.
Why India Is Particularly Exposed
India has become one of the largest buyers of Russian crude since the Russia-Ukraine war began.
Russian oil has formed part of India’s broader strategy of sourcing crude from multiple suppliers and managing energy costs.
That makes the new US law significant for New Delhi because any major tariff imposed on Indian exports could affect India’s access to the US market, while sharply reducing Russian oil purchases could alter the country’s energy procurement costs.
Reuters reported that India faces a difficult balance between maintaining energy security and protecting access to the US market.
India Had Already Warned Washington
Before Trump signed the law, India’s Ministry of External Affairs responded to the congressional passage of the measure.
New Delhi said it remained committed to securing energy for its 1.4 billion people and would continue to rely on diversified sources based on changing market conditions.
India also said the potential consequences of the US legislation for bilateral relations and international energy markets had been clearly communicated to American officials.
The government further stated that it would take necessary steps to protect its trade and economic interests.
That position remains important now that the legislation has become law.
India-US Trade Relations Face Another Test
The new sanctions law arrives after several rounds of changes in US tariff policy toward India.
India currently faces an additional 10% US Section 301 tariff related to the US investigation into forced-labour import prohibitions. The rate was finalised in July 2026 after India was placed in the lower tariff tier.
The 100% Russia-related tariff authority would therefore represent a potentially significant additional layer of trade restrictions if Trump chooses to use it.
However, the two measures have different legal bases and purposes, so they should not be treated as the same tariff.
Also Read | US Warns India, China Over Russian Oil as Trump Gets 100% Tariff Powers
What Could a 100% Tariff Mean for Indian Exports?
If the Trump administration eventually applies a 100% tariff to Indian goods under the new law, the consequences would depend heavily on the products covered and whether exemptions are provided.
Potential areas of impact could include:
Indian Exporters
Companies selling products to the US could face significantly higher landed costs if their goods become subject to the new duty.
Competitiveness
Higher tariffs could make some Indian products more expensive relative to goods supplied by competitors that are not subject to the same additional duty.
Trade Negotiations
The tariff authority could become another issue in ongoing India-US economic negotiations.
Energy Policy
India could face a policy trade-off between maintaining access to Russian crude and limiting potential exposure to US trade measures.
Global Oil Markets
A significant shift in purchases by India or China could alter crude flows, refinery economics, shipping patterns and global oil prices.
The eventual impact cannot be quantified until Washington specifies whether it will use the authority and how it will structure the tariffs.
Also Read | US Warns India, China Over Russian Oil as Trump Gets 100% Tariff Powers
What About the 500% Tariff Provision?
The legislation also contains much higher tariff authority concerning certain Russian goods.
According to the House Ways and Means Committee material cited in the supplied report, the law provides for tariffs of up to 500% on certain Russian goods, while the separate provisions concerning countries buying Russian oil and gas allow tariffs of up to 100%.
These are separate provisions and should not be confused with one another.
For India, the provision attracting the most attention is the potential 100% tariff on goods from major Russian energy purchasers.
China Is Also in the Crosshairs
India is not the only major economy facing potential consequences.
China is the world’s largest buyer of Russian crude, making it another important target of the legislation’s tariff mechanism.
The law therefore has implications beyond India-US relations and could affect one of the world’s biggest energy-trading relationships.
The legislation gives Trump substantial discretion over implementation, which means the eventual response from Beijing could depend on the scope and timing of any tariffs announced by Washington.
Why the US Passed the Law
Supporters of the legislation argue that Russia’s energy exports provide Moscow with revenue that helps sustain its economy and its war against Ukraine.
The law attempts to increase pressure on Russia not only by targeting Russian entities directly but also by discouraging other countries from maintaining large-scale purchases of Russian energy.
The legislation’s supporters have said the objective is to reduce the financial resources available to Moscow and increase pressure for negotiations over the war.
Critics, meanwhile, have raised concerns about the broad tariff powers granted to the president and the potential effects on global trade and consumer prices.
Why the Law Gives Trump Significant Flexibility
One of the most important features of the legislation is the discretion it gives the president.
The law does not simply establish one fixed tariff rate for every Russian oil buyer.
Instead, it creates a framework under which the administration can determine how the provisions are applied.
Reuters reported that the legislation gives Trump considerable latitude over which countries could face tariffs, the rates applied and potential waivers.
That means the next major development will not simply be the passage of the law, but how the Trump administration chooses to implement it.
What Happens Next for India?
For New Delhi, the immediate issue is likely to be monitoring Washington’s implementation decisions while maintaining its stated focus on energy security.
India has already communicated concerns about the possible effect of the sanctions regime on bilateral relations and international energy markets.
Indian exporters and businesses will also be watching for details about:
- The countries formally designated under the tariff provisions
- The tariff rates selected
- Products covered
- Effective dates
- Possible exemptions
- Any negotiations between Washington and affected governments
Until those details are announced, the precise financial impact on Indian exports cannot be established.
Also Read | US Warns India, China Over Russian Oil as Trump Gets 100% Tariff Powers
Trump Russia Sanctions Law: Key Facts
| Particular | Details |
|---|---|
| US President | Donald Trump |
| Law | Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 |
| Signed | September 18, 2026 |
| House vote | 262-159 |
| Main target | Russia |
| Additional focus | Iran |
| Russian energy tariff authority | Up to 100% on qualifying major buyers |
| Potentially affected major buyers | India, China and other qualifying countries |
| Russian goods tariff provision | Up to 500% under specified provisions |
| Russia targets | Officials, banks, energy interests and shadow fleet |
| India’s position | Protect energy security and trade interests |
Is India Already Facing a 100% US Tariff?
No. Trump’s signing of the law gives the administration authority to impose tariffs of up to 100% under the Russian energy provisions. It does not itself establish an immediate 100% tariff on all Indian exports.
Why Is India Being Targeted?
India is among the world’s major buyers of Russian crude. The US legislation is designed to pressure major purchasers of Russian energy and reduce the revenue flowing to Russia.
What Has India Said?
India has said it remains committed to ensuring energy security through diversified sourcing and has warned that the US measures could have implications for bilateral relations and international energy markets.
Can Trump Impose the 100% Tariff Immediately?
The law gives Trump the authority to impose the tariff, but the actual application depends on decisions by the administration, including which countries and products are covered and what rates are selected.
What Is the Current US Tariff on Indian Goods?
India was placed in a lower 10% Section 301 tariff tier in July 2026 in connection with the US investigation into policies concerning imports produced using forced labour. This is separate from the new Russia-related tariff authority.
Will the New Law Affect Indian Oil Prices?
It could affect India’s energy procurement economics if India changes its Russian crude purchases, but the precise effect on domestic fuel prices cannot be determined from the law alone. Global crude prices, discounts, freight costs, alternative suppliers and the eventual US implementation would all matter.
Also Read | US Warns India, China Over Russian Oil as Trump Gets 100% Tariff Powers
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