Weeks after waiving a 25% tariff on India over its purchase of Russian energy, the Trump administration issued New Delhi a 30-day waiver allowing refiners to buy Russian oil. This measure, announced by US Treasury Secretary Scott Bessent, is expected to help stabilize global energy markets in the wake of the US-Israeli strikes on Iran.
“To enable oil to continue flowing to the global market, the Treasury Department issued a temporary 30-day waiver to allow Indian refiners to purchase Russian oil. “This intentionally short-term measure will not provide significant financial benefit to the Russian government as it only allows transactions related to oil already stuck at sea,” Besant said in a post on
The Trump administration’s decision is likely motivated by fears that the conflict with Iran will lead to higher global energy prices and increased inflation within the United States. The Dow Jones Industrial Average fell nearly 800 points on Thursday amid widespread concerns.
Maintaining economic stability remains a top priority for the Trump administration, especially as it approaches this year’s midterm elections. The Republican Party is widely expected to lose control of the House of Representatives, the US House of Representatives, which could hurt President Trump.
Indian refiners were forced to reduce their relationships with Russian suppliers earlier last year after the US Treasury Department unveiled sanctions against energy giants Rosneft and Lukoil. According to the Center for Research on Energy and Clean Air, India’s purchases of crude oil from Russia fell by 12% in January compared to December.
Last month, India and the United States announced a trade framework. Washington reduced customs duties on goods coming from India to 18%. In return, American goods will gain greater market access in the industrial and agricultural sectors. India expressed its intention to purchase goods worth $500 billion from the United States over five years. The Trump administration confirmed that India has committed to stopping purchasing oil from Russia as part of its agreement.
The reversal of the US position regarding India’s purchases of Russian oil comes amid the escalation of conflict in West Asia. Military hostilities between Iran, the United States, and Israel have raised significant concerns about disruption to global shipping, including energy supplies.
Maritime traffic through the Strait of Hormuz, a major international shipping lane, has declined sharply since the conflict began last week. The interruption of energy shipments from West Asia has major repercussions for India, which imports more than 80% of its crude oil needs from foreign sources. A large share of these imports come from suppliers from West Asia such as Saudi Arabia and Iraq.
