India has been handed a breather on its Russian oil purchases. US President Donald Trump on Friday, October 16, signed an executive order that switches on the tough new Russia sanctions law passed by Congress and then immediately waives its most painful part: tariffs of up to 100% on goods from the biggest buyers of Russian crude and gas. The move came just two days before the law's October 18 deadline, and India and China are its clearest beneficiaries.
For Indian exporters, refiners and policymakers who had spent weeks bracing for a possible doubling of duties on shipments to the United States, the order removes an immediate threat. But trade experts are warning that the relief is conditional and could be withdrawn at any time.
What the Graham Act Says
The law at the centre of this story is the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, signed into law on September 18. It gave the President 30 days to act. Among its key provisions, it required tariffs of up to 100% on goods from the top five importers of Russian crude oil and natural gas if those countries knowingly made new purchases, with fresh purchases from October 18 in the firing line. A similar penalty was set for the top five facilitators of sanctions evasion on Russian oil.
The act also carried wider sanctions on Russian leaders, officials and financial institutions, and expanded measures against Iran.
What Trump Actually Waived
Instead of letting the tariffs kick in, Trump used the national-interest waiver built into the law. According to the White House text cited in reports, the waiver under section 115(a) covers the duties under sections 112 and 113 of the act. Most of the broader sanctions on foreign persons were also suspended.
Three points matter most for India:
- No fixed end date: The waiver does not carry an expiry date.
- It can be pulled back: The President can withdraw it whenever he chooses, and the administration has said it will keep watching Russian energy purchases by major importers.
- Older sanctions stay: Russia-related sanctions under other executive orders are untouched.
Because this is a waiver and not a repeal, the tariff powers remain on the books and can be used later without fresh approval from Congress.
Key Facts at a Glance
| Law | Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 |
| Signed into law | September 18, 2026 |
| Waiver order signed | October 16, 2026 |
| Original deadline | October 18, 2026 |
| Tariff waived | Up to 100% on top 5 buyers of Russian oil and gas |
| Expiry | None fixed; can be withdrawn any time |
| Main beneficiaries | India, China |
Why the White House Stepped Back
Trump cited the US national interest. The decision also lands at a time of very high global energy prices, when further curbs on Russian oil could push markets even higher. It also fits a broader thaw in US-Russia energy dealings: earlier in October, Washington temporarily eased sanctions on Russian diesel exports under an October 9 arrangement.
Reactions were split along predictable lines. Kirill Dmitriev, an economic envoy to Russian President Vladimir Putin, called the move historic. US Senator Richard Blumenthal, one of the law's co-drafters, criticised the waiver as undermining the whole point of the legislation.
What It Means for India
India is one of the world's largest buyers of Russian crude, and Russia's share of its oil imports has been above 30% in recent years. Data cited by the Global Trade Research Initiative (GTRI) shows that share slipped from 51% in July to 44% in August as refiners bought more from the United States and the UAE.
GTRI's founder Ajay Srivastava summed up the mood in his think tank's report: "For India, the waiver buys time but offers no lasting certainty." He has urged India to protect its energy security and keep buying oil strictly on commercial terms, noting that US interests will decide when penalties apply.
Former BPCL refineries director R. Ramachandran said the main gain is flexibility in sourcing crude rather than any big jump in refining margins. In his view, it is still too early for refiners to lock into long-term Russian contracts.
CareEdge chief economist Rajani Sinha said steady access to supply now matters more to India than discounts, which have narrowed. She expects the current account deficit to stay between 0.8% and 1.2% of GDP if crude trades between $80 and $100 a barrel, with average inflation of around 5 to 5.5%. She does not expect the waiver to give the rupee much direct support.
For ordinary Indians, the link is simple. Any sudden tariff shock on exports, or a scramble to replace Russian barrels, could feed into fuel prices, jobs in export sectors and inflation. For now, that risk has been parked.
What Happens Next
The waiver keeps the door open for Washington to bring the tariffs back if it decides Russian purchases by big buyers are too high. That leaves Indian refiners balancing cheaper Russian barrels against the risk of a sudden policy reversal. Meanwhile, New Delhi and Washington are still working on the first tranche of their trade deal, and how that agreement shapes up could matter as much as the waiver itself.
Expect oil companies to keep diversifying their supply, and trade bodies to keep pressing for clarity on how long the reprieve will last.
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