- US to cut tariffs on Indian goods from 50% to 18% in a new trade deal with India
- India agreed to reduce Russian oil imports, replacing them with US and Venezuelan oil, Trump claimed
- PM Modi welcomed tariff cut but did not confirm reducing Russian oil purchases
US President Donald Trump has announced that Washington would reduce tariffs on Indian goods from 50 per cent to 18 per cent, in exchange for a promise from New Delhi to stop buying Russian oil, among other things. Taking to his Truth Social platform, Trump said that Prime Minister Narendra Modi has agreed to replace India's Russian crude imports with oil from Venezuela and the United States.
India has been importing around 1.5 million barrels of Russian crude per day, even after Trump imposed 25 per cent punitive tariffs on Indian goods, making it over one-third of the overall Indian imports, according to global trade data provider Kpler. India is the second-largest purchaser of Russian crude.
What Trump Said
On Monday, the US president said that he and Prime Minister Narendra Modi, whom he proclaimed to be "one of my greatest friends", had agreed to strike a trade deal, bringing tariffs on Indian goods to 18 per cent from 50 per cent. While full details of the trade pact have yet to be disclosed, Trump claimed that India had agreed to stop buying Russian oil and would now buy oil from the US and potentially Venezuela.
He wrote on his Truth Social platform, "This will help END THE WAR in Ukraine, which is taking place right now, with thousands of people dying each and every week!"
India's Reaction
PM Modi welcomed the "wonderful" news on tariff reduction in a post on X but did not explicitly mention cutting purchases of Russian oil. He added, however, that "President Trump's leadership is vital for global peace, stability, and prosperity."
The Indian government has previously defended its Russian oil trade, calling it essential to the country's energy security. New Delhi relies heavily on oil imports from other nations to cover the vast majority of its demand.
Historically, India's relationship with Russia revolved more around defence than energy. Russia provided only a fraction of India's oil, but the majority of its military hardware.
But in the aftermath of the Russian invasion, India used the moment to buy discounted Russian oil, allowing it to increase its energy supplies while Russia looked to cut deals to boost its beleaguered economy and keep paying for its brutal war.
Can Venezuelan Oil Fulfil India's Crude Needs
Venezuelan oil is reportedly of similar quality to Russian crude—sour, heavy, and good for making derivatives like fuel oil and diesel, which India's refineries are already set up to process. But New Delhi buys more oil from Russia than Venezuela produces.
So far, Venezuela's oil infrastructure is dilapidated and would need over a decade of work and tens of billions of dollars in investment to return to the over 3 million barrels a day output it used to produce before the country's Socialist government took control in 1999.
Therefore, purchases of Venezuelan oil could help replace some of the Russian oil bought by India, the world's third-biggest oil importer.
"Fully replacing Russian oil with oil from Venezuela or the US will take significant investment," said Rob Haworth, senior investment strategy director at US Bank Asset Management, while talking to CNN.
"But over time, this may create additional challenges for the Russian economy," he added.
Russian Oil Hurdle In India-US Deal
Russian oil has been the major hurdle. As recently as December 2025, Russian President Vladimir Putin said during a visit to New Delhi that he was ready to continue "uninterrupted shipments" of fuel to India despite US pressure.
Trump also said in October that PM Modi had promised to stop buying Russian oil, but an agreement did not materialise at the time.
