US President Donald Trump has signed a new Russia sanctions law that gives his administration wider powers to impose tariffs on countries that buy Russian oil and gas.
The law allows the US to impose tariffs of up to 100% on goods from countries that are among the five biggest buyers of Russian crude oil or gas. It can also target countries that continue to make new purchases of Russian energy or help Russia avoid sanctions.
The move could put major buyers such as India and China under pressure. However, the law does not name any country directly. It also does not clearly explain how the five biggest buyers will be identified. This gives the Trump administration considerable freedom in deciding which countries could face tariffs.
For India, the new law could create a risk of higher tariffs on Indian goods entering the US. The immediate impact, however, is still unclear.
India has become a major buyer of Russian oil, particularly since Western sanctions were imposed on Moscow. Cheaper Russian crude has helped Indian refiners manage energy costs. Any major change in this trade could therefore affect both energy supplies and India-US economic ties.
The law was passed by the US Congress on Wednesday and signed by Trump on Friday. It targets Russia’s energy and defence sectors and also includes measures against Russia’s so-called shadow fleet of tankers, which Washington says helps Moscow avoid sanctions.
Trump will also have the power to waive the tariffs or sanctions on national security grounds. This means the administration can decide how and when to use the new powers.
The legislation has already raised concerns in India and other countries. India has warned that additional US tariffs could affect bilateral relations, while China has criticised the move as an example of US pressure on other countries.
Analysts have also raised questions about the broad language of the law and the amount of power it gives the US president. Others argue that the legislation provides clear enough conditions for deciding which countries could be targeted.
The timing could add to the uncertainty. The law requires possible tariffs to be imposed within 30 days, bringing the decision close to the US midterm elections in November.
Higher tariffs on major buyers of Russian energy could also affect global oil supplies and push energy prices higher. For now, countries such as India will be watching closely to see how the Trump administration uses its new powers.
