In less than a month, Washington has threatened buyers of Russian energy, became a buyer itself, and then put the punishment on hold. For India, these reversals carry consequences for both energy security and trade talks.On September 18, Washington enacted the Graham sanctions law, threatening countries including India with additional tariffs of up to 100 per cent for buying Russian oil. On October 9, faced with rising fuel prices at home, US President Donald Trump struck a deal with President Vladimir Putin to buy Russian diesel. Punishing others for buying Russian energy would then invite charges of hypocrisy. On October 16, Trump waived the penalties without specifying how long the relief would last.AdvertisementWith the penalties suspended, India can continue buying Russian oil for now. But the tariff threat remains, and Washington may use it to pressure India into an unequal trade deal.The policy reversal began with rising fuel prices at home. US retail diesel prices rose 66.5 per cent in a year, from about $3.71 a gallon in October 2025 to $6.18–$6.20 in October 2026. Diesel powers trucks, farm machinery and industrial supply chains, so higher costs raise grocery and other consumer prices. Heating bills add pressure ahead of winter, while voter anger threatens Republicans before the midterm elections.Under the deal, Russia would supply 3,00,000 tonnes immediately, 5,00,000 tonnes in November and 1 million tonnes soon after. Total shipments could reach 4.8 million tonnes.AdvertisementIn return, Russia gained sanctions relief until April 7, 2027, allowing sales in global markets and potentially earning dollars for Russian oil producers, including Rosneft and Lukoil. Washington threatens others for buying Russian energy but makes an exception when its own economy needs relief.SpaceX’s Starlink and Starshield restrictions also need to be factored in. Ukrainian troops reported disconnections at speeds above 100 mph, disrupting interceptor and attack drone missions. Elon Musk has said commercial Starlink serves civilian and defensive purposes, while Starshield is operated under US government oversight. Yet the restrictions also hindered drones defending Ukraine against Russian attacks.Ukraine and European allies have sharply criticised the US-Russia diesel deal. President Volodymyr Zelenskyy has warned that sanctions relief without lasting de-escalation would legitimise Moscow and finance its war. European leaders have argued that the move undermines sanctions and weakens their leverage in negotiations.Coming back to India, recent statements from both sides suggest an interim India–US trade agreement under the February 6 Joint Statement may be nearing completion.On October 1, United States Trade Representative Jamieson Greer said that talks were “in the short strokes”. The same day, commerce minister Piyush Goyal expressed hope for an early interim agreement. On October 5, Finance minister Nirmala Sitharaman said talks had reached a “plateau” and further concessions would be “very, very difficult”. On October 14, External Affairs Minister S Jaishankar said negotiations were “pretty far advanced” and “heading towards a landing point”.These remarks suggest much of the negotiating work is complete. Sitharaman’s warning points to little room for Indian concessions beyond the February 6 framework, while Goyal and Jaishankar signal a desire to close the deal.Latest reports suggest the agreement is being legally drafted. It could be signed once the US agrees to give Indian goods a tariff advantage over competing countries. The timing and final terms remain uncertain.The central obstacle is this: What tariff is Washington offering? The February 6 framework proposed cutting the US reciprocal tariff from 25 per cent to 18 per cent in return for major Indian concessions. But the US Supreme Court struck down those tariffs on February 20, removing the legal basis for that offer. India’s proposed concessions remained on the table, while the promised US benefit became unclear.Washington then imposed a 10 per cent forced-labour tariff under Section 301. The Graham sanctions law authorises tariffs of up to 100 per cent on countries such as India buying Russian energy. Despite the October 16 waiver, India faces an existing additional duty and a larger potential penalty without knowing which duties an agreement would remove.Unlike most of its competitors, India faces the threat of US penalty tariffs for importing Russian oil. China, for instance, is shielded from new bilateral tariffs until January 2027 under the Busan Agreement. India needs to know the final US duties on its goods compared with those on competing countries. Talks had stalled without those figures. This was the stalemate until the US signed its own diesel deal with Russia and issued a temporary waiver on October 16.Despite the waiver, the threat of new tariffs for buying oil from Russia may help the US make a clearer offer to India. Washington could exempt India from Russian-oil penalties for a longer period while retaining the 10 per cent Section 301 duty, alongside normal most-favoured-nation tariffs, in return for accepting the February 6 terms. India could continue buying Russian oil.This would clarify the US tariff offer, but there is a problem. Escaping a threatened 100 per cent penalty is no special favour when most competitors without a trade deal face normal duties plus 10 per cent or 12.5 per cent — and when the US itself is buying Russian diesel.you may likeThe February framework required major Indian concessions. Accepting those terms after the promised US benefit has changed could leave India worse off. Without clear, lasting gains, India should wait rather than sign.India should also stop granting major unilateral concessions while negotiations remain unfinished. Over the past two years, it has cut duties on products of US interest, including motorcycles, bourbon, some pharmaceuticals and Ethernet switches. It has allowed foreign investment in inventory-based e-commerce for exports and scrapped the equalisation levy on foreign platforms. The proposed UPI fees after Diwali could benefit Visa and Mastercard. Each concession without a gain in return reduces India’s bargaining power. India should count their total value when negotiating what Washington must offer.Washington’s turn toward Moscow shows how quickly domestic needs can override foreign-policy commitments. India should judge a trade deal by the clear, lasting benefits it secures — not by relief from penalties Washington has threatened to impose. If those benefits remain uncertain, New Delhi should preserve its bargaining power and wait like most countries.The writer is founder, GTRI