US Urges G7 Allies to Target China, India with Tariffs Over Russian Oil Purchases
WASHINGTON – The United States is calling on its G7 partners to adopt a more aggressive stance against countries propping up Russia's war economy, urging the bloc to impose “meaningful” tariffs on China and India for their continued large-scale purchases of Russian crude oil, according to senior administration officials.
The proposal marks a significant potential escalation in the economic pressure campaign against Moscow, aiming to close financial lifelines that have allowed the Kremlin to sustain its war effort in Ukraine despite sweeping Western sanctions.
For more than a year, the G7 and Australia have maintained a $60-per-barrel price cap on Russian seaborne oil. While the cap was designed to keep Russian oil on the global market to prevent price shocks, it sought to limit Moscow's profits. However, massive volumes purchased by China and India, often utilizing a "shadow fleet" of tankers and non-Western insurance, have provided Russia with a steady and substantial revenue stream, blunting the impact of the sanctions.
“We are seeing a clear circumvention of our sanctions regime, and the primary enablers are in Beijing and New Delhi,” said a senior State Department official, speaking on condition of anonymity to discuss sensitive diplomatic negotiations. “Simply put, record purchases of Russian crude are directly funding the missiles and tanks being used against Ukraine. It's time for our coalition to address this, and that may require implementing tariffs that make these purchases less attractive.”
The push from Washington comes ahead of key diplomatic meetings where coordinating policy on Russia and China is high on the agenda. U.S. diplomats have reportedly begun sounding out their counterparts in Europe, Japan, and Canada, arguing that a united front is necessary to increase the economic cost for Russia.
The proposed tariffs would target goods imported from China and India, with the potential to be scaled based on the volume of Russian oil they import. The goal would not be to halt their trade with the West, but to create a significant economic disincentive that offsets the discount they receive on Russian oil.
The call, however, is expected to face considerable headwinds within the G7. Some European nations, particularly Germany with its export-dependent economy, are likely to be wary of escalating a trade dispute with China, its largest trading partner. There are also concerns that such a move could push India, a key strategic partner for the West in the Indo-Pacific, closer to the Russia-China axis.
“This is a high-risk, high-reward strategy,” commented Elara Vance, an energy security analyst at the Atlantic Council. “On one hand, it’s the most direct way to penalize the enablers of Russia’s war machine. On the other, it could splinter G7 unity, alienate a critical partner in India, and trigger a retaliatory trade war with China that could destabilize the global economy.”
Both Beijing and New Delhi have consistently defended their trade with Moscow, citing national energy security and economic interests. They argue that as sovereign nations, they are not bound by Western sanctions they did not endorse.
In response to previous criticism, an Indian foreign ministry official stated that the country’s primary obligation is to its citizens and ensuring “affordable and accessible energy.” Similarly, China has accused the U.S. of unilateralism and using its economic might to enforce its foreign policy on others.
Russian oil exports to China and India have surged since the 2022 invasion of Ukraine. According to energy market data, the two nations now account for approximately 90% of Russia’s seaborne crude exports, up from around 35% before the war. This shift in trade flows has allowed Russia’s federal budget to recover from initial shocks, with oil and gas revenues remaining robust.
As G7 leaders prepare for their next summit, the U.S. proposal will force a difficult conversation about the future of the sanctions strategy. The debate will center on whether the alliance is prepared to risk broader economic and diplomatic fallout to tighten the financial noose around Vladimir Putin's Kremlin.