Trump's tariffs to India's oil bets: Decoding sanctions on Russia

Even before Russia invaded Ukraine in February 2022, Moscow was under sanctions due to its annexation of Crimea

Facing sanctions from multiple countries since the Ukraine conflict in 2022, including the United States (US) and the European Union (EU), Russia has become one of the most heavily sanctioned nations globally. Over the years, the EU has announced 18 sanction packages against Russia.

Sanctions on Moscow are now trickling down to India, with refiners like Nayara Energy struggling to keep operations running and Indian traders staring at a 50 per cent US tariff.

Here's a look at the various sanctions and trade bans imposed on Moscow over the years and how they translate for the country's economy.

The pre-Ukraine picture

Even before the Russia-Ukraine conflict began in February 2022, starting one of the largest and deadliest wars in Europe since World War II, Moscow was still under sanctions.

In March 2014, Russia annexed the Autonomous Republic of Crimea and the city of Sevastopol. This was seen as a violation of the territorial integrity of Ukraine. Shortly after this, the US and EU imposed multiple sanctions against Russian banks and energy firms. According to the European Union External Action, here are some of the bans that were placed on Russia:

• Imports were banned from the EU to Crimea unless a Ukrainian origin certificate was present
• Investments by EU companies were halted in Crimea
• Exports of products or technology related to telecoms, energy were stopped
• EU tourism services in Crimea were halted
• Assets of 48 entities (companies, institutions) were frozen in Crimea and Sevastopol

Fresh sanctions under Trump's first presidency

While it seemed like Russian President Putin and the newly appointed American President Donald Trump would get along well, Trump gave a green light to multiple sanction packages against Russia despite maintaining a friendly stance in public. During Trump's first tenure as the US president (2017-2021), here are some of the bans imposed on Russia:

According to the US State government data, Washington imposed sanctions against eight Russian companies in connection with the Iran, North Korea, Syria Nonproliferation Act in March 2017.

In April 2017, CNN reported that the Trump administration denied a request from ExxonMobil to allow it to resume oil drilling in Russia.

Trump imposed fresh sanctions in 2018 on 13 Russian government hackers and front organisations that had been indicted by Mueller's investigation, according to Business Insider.

Sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA), targeting defence deals with Russia, were also expanded.

After the Ukraine war: Full throttle

The invasion of Ukraine triggered a rapid escalation, prompting sanctions from countries that were not participating earlier, including South Korea and Taiwan. Several sectors, including oil, energy, and banking, were placed under heavy sanctions from multiple countries.

The EU launched its 11th sanctions package against Russia in 2023, barring trade and transport. This was followed by several other packages, including the most recent 18th package.

The bans targeted oligarchs, defence firms, tech sectors, and entire industries.

According to the BBC, 70 per cent of the assets of Russian banks were frozen, and some were excluded from SWIFT, a high-speed messaging service for financial institutions.

Hundreds of major companies, such as Heineken, McDonald's, Starbucks, and Coca-Cola, stopped selling and producing goods in Russia.

According to an NYT report, US President Joe Biden (2021-25) placed over 170 new sanctions on Russian entities between 2022 and 2024. The targets included oil and weapons production, tech procurement and banking.

Biden vs Trump: Who did what?

After a slew of sweeping tariffs by the Biden administration, Trump has not imposed any fresh sanctions on Russia since he returned to office in January, NYT reported in July.

  Numbers game

13,500: Total sanctions placed on Russia since February 2022, according to Castellum.AI.

2.1%: Russia's gross domestic product (GDP) contracted in 2022, according to International Monetary Fund (IMF) estimates. However, it rebounded in 2023 due to energy exports. IMF projects Russia's real GDP growth for 2025 at 1.5 per cent.

1.9 mbd: Russian oil was exported to India in 2024, up from 0.1 million barrels per day (mbd) in 2021, according to the International Energy Agency. India and China were the major importers in 2024, with New Delhi accounting for 1.9 mbd and Beijing at 2.4 mbd. 

41.4%: Russian news agency TASS stated that Russia’s trade turnover with BRICS nations stood at $294 billion in 2023 (41.4 per cent of total foreign trade) and grew 2.4-fold compared with 2019-2020. 

Russian oil exports

What does it mean for India?

Maintaining its neutral stance, India continued to buy oil from Russia at discounted rates since 2022. However, the recent 25 per cent tariff, along with a 25 per cent penalty for buying Russian oil, imposed on India by Trump, may have long-lasting repercussions. Here are some ways in which tariffs can hurt imports from Russia:

• If geopolitical tensions escalate, Brent prices could spike, wiping out part of India’s discount advantage.
• Washington could tighten enforcement on intermediaries, making it harder for Indian refiners to use non-dollar payment systems or insurers.
• Indian banks may become more cautious in processing Russia-linked trade, potentially delaying shipments or raising transaction costs.

What’s next

Russia has long courted sanctions, but the ripple effects are now reaching India with the imposition of a 50 per cent tariff. Still, Prime Minister Narendra Modi says he is ready for the fight. As reported earlier by Business Standard, Modi on Thursday said that India would not compromise on the interests of its farmers, fishermen or dairy farmers, even if it meant him "paying a heavy price".