According to WPB, legislation that could expose major buyers of Russian energy to U.S. tariffs of up to 100% has moved one step closer to taking effect after the U.S. House of Representatives approved the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 by a 262–159 vote on September 16. The measure has now cleared both chambers of Congress and moved to the presidential stage.
The latest vote represents a significant change from the situation in August, when the legislation had passed the Senate but still required House approval. The Senate approved the measure by an 86–11 vote on August 7, while the House has now accepted the Senate version without changing the central Russian-energy tariff provisions.
The legislation expands sanctions targeting Russia’s energy, financial and defense-related activities and includes measures aimed at networks facilitating sanctions evasion, including activities involving Russia’s shadow tanker fleet. It also extends existing U.S. sanctions legislation relating to Iran.
One of the most consequential provisions for energy markets is Section 113, which establishes duties of up to 100% on goods imported into the United States from countries meeting specified conditions linked to purchases of Russian-origin crude oil or natural gas and facilitation of Russian oil sanctions evasion.
The provision does not automatically impose a 100% tariff on every country purchasing Russian oil. Under the legislation, exposure depends on statutory criteria, including continued new purchases after enactment and whether a country ranks among the largest buyers of Russian crude or natural gas, or among the leading jurisdictions facilitating sanctions evasion.
This distinction is particularly important for India and China because both have become major destinations for Russian energy flows. The legislation therefore creates substantial potential trade exposure, but the exact tariff rate, implementation process and treatment of individual countries will depend on the law entering into force and subsequent determinations under its provisions.
As of September 17, the legislation had not yet completed the presidential stage. The U.S. administration had previously expressed support for the Senate version and said presidential advisers would recommend signing it, but the tariff provisions cannot be treated as implemented until the legislative process is completed.
India responded by reiterating that its priority remains energy security and access to diversified supplies. The government said future sourcing decisions would continue to reflect evolving market conditions while making clear that it would take necessary measures to protect the country’s trade and economic interests.
India also said it had communicated concerns about the possible consequences of the legislation for both bilateral economic relations and the international energy market. The country is the world’s third-largest oil importer and has become one of the largest buyers of Russian crude, making the new U.S. legislation particularly relevant to its refinery sector.
At this stage, however, there is no confirmed evidence that Indian refiners will reduce Russian crude purchases because of the House vote. There is also no basis for assuming that Washington will immediately apply the maximum 100% tariff once the legislation enters into force.
The market significance lies instead in the additional uncertainty now attached to Russian crude economics. Indian refiners must weigh discounted Russian barrels against potential trade exposure, alternative crude costs, freight, refinery yields and security of supply when determining future purchasing strategies.
That calculation has become more complicated because Asian refiners are already operating in an unusually disrupted crude market. Instability around Gulf shipping routes has increased uncertainty over Middle Eastern supply logistics at the same time that U.S. policy is creating additional risk around Russian barrels.
If the new legislation eventually changes Indian demand for Russian crude, the impact could extend beyond bilateral trade. Russian differentials, tanker routes, ship-to-ship activity and competition for alternative crude from the Middle East, the Americas and other regions could all respond to changes in refinery purchasing patterns.
The consequences would also depend on how Russia redirects barrels that lose access to existing customers. A reduction in one destination does not automatically remove crude from the global market, because discounted cargoes can be redirected toward other buyers if logistics, sanctions exposure and payment arrangements remain workable.
For India, replacing Russian crude would carry its own economic considerations. Alternative grades may have different prices, freight costs, refinery yields and product outputs, meaning the effect cannot be measured only by comparing headline crude prices.
This is also where the development becomes relevant to the bitumen and asphalt markets. Indian refinery bitumen output depends partly on crude slate, refinery configuration, processing economics and the allocation of heavy residual streams, so significant changes in crude sourcing could eventually influence production economics.
There is nevertheless no evidence at present that the House vote has changed Indian bitumen production or export availability. Any direct claim that the legislation has already reduced or increased bitumen supply would therefore go beyond the available data.
The more immediate transmission channels for the bitumen market are crude differentials, refinery feedstock costs, tanker routing and transportation expenses. If Russian crude becomes commercially less attractive for Indian refiners, alternative sourcing could change refinery input costs before any measurable effect appears in bitumen production volumes.
Changes in Russian oil flows could also influence shipping markets. Different loading regions and voyage distances alter tanker demand, voyage duration and freight economics, potentially affecting the wider pool of shipping capacity available across Asian energy markets.
For bitumen exporters and buyers, however, crude-tanker movements should not be confused with specialized bitumen shipping. Bulk bitumen requires heated vessels and dedicated handling systems, so changes in crude routes do not translate directly into equivalent changes in bitumen vessel availability.
The next decisive development will be the completion of the U.S. legislative process and the implementation details that follow. Market participants will then need to assess which countries fall within the relevant statutory categories, what tariff rates are applied and whether waivers or other presidential authorities alter the practical effect.
India’s refinery purchasing data will be equally important. Actual changes in Russian crude nominations, imports and refinery crude slates will provide stronger evidence of market impact than political statements alone.
Until those indicators change, the current development should be viewed as a major increase in policy risk rather than evidence of an immediate disruption to Russian crude or Indian bitumen supply. The House vote has removed one important legislative barrier, but the commercial consequences will depend on what happens after enactment and how major energy buyers respond.
For the Asian bitumen market, the issue is therefore not a confirmed supply shock but the possibility that another major part of the region’s refinery feedstock system could become more expensive or more difficult to manage. At a time when Gulf crude logistics are already under pressure, additional uncertainty surrounding Russian barrels adds another variable to refinery economics across Asia.
By WPB
Russian Oil, India, U.S. Sanctions, U.S. Tariffs, Russia Sanctions, Crude Oil, Russian Crude, India Refining, Energy Security, Shadow Fleet, Crude Differentials, Refinery Feedstock, Bitumen, Asphalt, Bitumen Production, Tanker Routing, Freight, Asian Refining
