Oil Under Tariff Pressure: What New U.S. Sanctions Mean for Russia

The main feature of the new mechanism is that the economic interests of Russia's trading partners are becoming an instrument of sanctions pressure. Indian oil refiners are interested in purchasing Russian crude oil on favorable terms, while Indian exporters need to maintain access to the U.S. market. As a result, the terms of oil trade are beginning to depend not only on global oil prices but also on risks affecting other sectors of the economy. For Russia, this means greater uncertainty in one of its most important export markets.

However, an immediate halt to Indian purchases of Russian oil is by no means inevitable. India is a major energy importer, and replacing substantial volumes of Russian supplies without incurring additional costs would be difficult. Doing so would require alternative sources of oil, suitable crude grades, and new delivery routes. Moreover, a sharp reduction in Russian supplies amid limited global market availability could push prices higher, which would not serve the interests of major importers. Much will depend on how the U.S. law is implemented in practice and on the commercial decisions of Indian companies.

For Russia's oil industry, the key indicator is not the number of tankers dispatched but net export revenue. Even if physical supply volumes remain unchanged, buyers may demand additional discounts to compensate for increased sanctions risks. At the same time, freight, insurance, and payment processing costs may rise. Redirecting shipments to other markets also requires time and money. As a result, a company may sell the same amount of oil as before, but the new environment will require new pricing models that take into account the fact that the narrower the pool of available buyers, the stronger their bargaining position in price negotiations.

At the same time, the consequences for Russia's export revenues are not predetermined. If the new restrictions reduce global oil supply, rising international oil prices could partially offset losses from discounts or lower export volumes. However, it is important not to confuse the Brent benchmark price with the actual selling price of Russian oil. Assessing the economic impact requires taking into account discounts, transportation costs, payment terms, and the timing of cash receipts. The combination of these factors will determine the ultimate profitability of exports.

For the federal budget, the new risks are emerging against the backdrop of an existing trend in oil and gas revenues. According to preliminary estimates by the Russian Ministry of Finance, these revenues amounted to 5.019 trillion rubles in January–August 2026, down 16.7% from the same period a year earlier. These figures cannot be attributed to the September law: the ministry primarily links changes in oil and gas revenues to earlier fluctuations in the exchange rate and oil prices. Nevertheless, further changes in export profitability could complicate budget execution.

The impact of the new restrictions may also extend to businesses that are not directly involved in oil exports. A more cautious approach by foreign banks, insurers, and shipping companies could increase the cost of international trade operations. Importers of equipment and components will have to account for potential delays in payments and deliveries, while exporters may face longer waiting periods before receiving their revenues. For large companies, this means additional risk management expenses, whereas for smaller businesses, even a relatively short delay in settlements could result in a shortage of working capital.

For Russian consumers, the main question is whether foreign trade restrictions will lead to higher domestic prices. A U.S. tariff on Indian goods does not, in itself, automatically mean higher food or gasoline prices in Russia. One possible transmission channel is the exchange rate: a decline in export revenues could increase pressure on the ruble, raising the cost of imported goods and components. Another channel involves rising international logistics and payment processing costs. The magnitude of these effects will depend on the ruble exchange rate, the Bank of Russia's monetary policy, and domestic demand conditions. It would be unjustified to forecast specific rates of consumer price increases at this stage.

Thus, the main economic risk posed by the new U.S. law to Russia lies not only in a potential reduction in oil exports but also in rising international trade costs. The actual consequences should be assessed by monitoring India's purchases of Russian oil, the size of export discounts, transportation costs, and federal budget revenues from oil and gas. These indicators will make it possible to determine the extent to which sanctions pressure translates into additional costs for Russian businesses and, ultimately, consumers.

Author: Doctor of Economics, Professor at the Department of World Economy and International Finance, Financial University under the Government of the Russian Federation, Anna Gennadyevna Glebova.