At the World Economic Forum in Davos, US Treasury Secretary Scott Bessent delivered a pointed message: Washington’s pressure campaign on India over Russian oil is working—and that could open the door to easing tariffs.

In remarks to Politico, Bessent said India’s refinery purchases of Russian crude have “collapsed” following the imposition of a 25% US tariff, calling the outcome a “huge success.” While the tariffs remain in place for now, he suggested there is a diplomatic “path” to removing them if New Delhi continues to shift its energy sourcing.

The comments land at a volatile intersection of geopolitics, energy security, and trade diplomacy, with India, the US, and the European Union all recalibrating their positions amid the war in Ukraine.

What Did Scott Bessent Say About Tariffs on India?

Speaking in Davos, Bessent framed the tariffs as a tool that has delivered tangible results.

“We put a 25 per cent tariff on India for buying Russian oil, and the Indian purchases by their refineries of Russian oil have collapsed. So that is a success,” he told Politico.
“The tariffs are still on. I would imagine there is a path to take them off, so that’s a check and a huge success.”

The implication was clear: tariffs are leverage, not an end state. If India continues to reduce its reliance on Russian crude, Washington could consider rolling back the additional duties.

Why Russian Oil Is at the Center of the Dispute

Since Russia invaded Ukraine, energy markets have been reshaped by sanctions and price caps. India emerged as a major buyer of discounted Russian crude, refining it for domestic use and export.

Before the war, Russian oil accounted for just 2–3% of India’s crude imports. That share surged into the high teens as discounts deepened, delivering windfall profits to Indian refiners and helping India keep fuel prices relatively stable.

From Washington’s perspective, those purchases undermined the broader sanctions regime aimed at squeezing Moscow’s revenues.

India’s position has been consistent: its energy policy is guided by affordability and availability for its 1.4 billion citizens, not geopolitics.

A Bigger Stick Looms in Congress

Bessent’s remarks come as lawmakers in Washington debate a far more aggressive measure.

A proposed bipartisan bill in Congress would impose a 500% duty on countries that continue buying Russian oil. Senator Lindsey Graham said in January that President Donald Trump has given the bill a green light, framing it as a way to pressure countries “fuelling Putin’s war machine.”

India’s Ministry of External Affairs has acknowledged the legislation but stopped short of changing course.

“We are aware of the proposed bill. We are closely following the developments,” MEA spokesperson Randhir Jaiswal said at a weekly briefing.

The contrast is stark: while the executive branch signals flexibility, Congress is sharpening the knife.

India’s Balancing Act: Autonomy vs. Pressure

New Delhi now finds itself navigating between:

• US economic pressure through tariffs and sanctions threats
• Domestic political imperatives around fuel prices
• A shifting global energy market
• Strategic partnerships with both the West and Russia

For Indian policymakers, the calculus remains pragmatic. Russian oil has been cheap, plentiful, and logistically viable. But sustained US pressure—and the risk of even harsher penalties—appears to be nudging refiners to diversify.

Bessent Takes Aim at Europe’s “Irony”

Bessent reserved some of his sharpest words for America’s European allies.

He accused European countries of hypocrisy for condemning Russian oil while buying refined petroleum products from India—products often made from Russian crude.

“In the ultimate act of irony and stupidity, guess who was buying the refined products from the Indian refineries made from Russian oil? The Europeans,” Bessent said.
“They are financing the war against themselves.”

From his perspective, Europe avoided imposing tariffs on India not out of principle, but convenience.

The EU-India Trade Deal Changes the Equation

Europe’s reluctance, Bessent argued, is tied to something much bigger: a looming EU-India Free Trade Agreement.

European Commission President Ursula von der Leyen has described the deal as “the mother of all deals”—a pact that would create a combined market of 2 billion people, representing roughly 25% of global GDP.

The EU and India are set to hold their 16th summit in New Delhi, where a new comprehensive strategic agenda is expected to be adopted. Von der Leyen is scheduled to visit India next weekend to help finalize the agreement.

“There is still work to do. But we are on the cusp of a historic trade agreement,” she said in Davos.

Bessent was blunt in his assessment:

“Our virtue signalling European allies refused to do it because they wanted to sign this big trade deal with India.”

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Why This Moment Matters

The episode underscores how energy has become a currency of diplomacy.

For the US:

• Tariffs are a pressure tool to enforce sanctions discipline.
• Success is measured in altered behavior, not permanent punishment.

India:

• Energy security remains non-negotiable.
• But diversification may be the price of smoother trade relations.

Europe:

• Strategic ideals are colliding with economic realities.
• India is too important a partner to alienate.

The result is a messy but revealing snapshot of how power is exercised in a fragmented global economy.

What Happens Next?

Several paths remain open:

• The US could gradually lift the 25% tariff if India continues cutting Russian oil purchases.
• Congress could still pass a 500% duty, forcing a sharper confrontation.
• India could lean more heavily into alternative suppliers while preserving strategic autonomy.
• The EU-India FTA could reshape trade incentives across continents.

Much will depend on whether diplomacy can keep pace with domestic politics in Washington.

TL;DR

• US Treasury Secretary Scott Bessent says tariffs caused India’s Russian oil imports to “collapse.”
• He hinted that the 25% tariff could be removed if the trend continues.
• Congress is considering a far harsher 500% duty on Russian oil buyers.
• India insists affordable energy remains its top priority.
• Europe faces criticism for buying refined Indian fuel made from Russian crude while pursuing a major trade deal with New Delhi.