Trump Targets Russian Oil: Strategic or Foolish?

Sam Sepehri

2nd November 2025

Written by Sam Sepheri

In a significant shift in policy, the U.S. has announced a 50 percent tariff hike on two major Russian oil companies, Rosneft and Lukoil, to restrict their access to U.S. assets. Alongside this, President Trump has warned that other countries could face similar tariffs if they continue importing Russian oil. These measures form part of a broader plan to increase economic pressure on Russia over its ongoing war in Ukraine.

Russia’s energy sector remains a vital source of income, and targeting its oil exports is intended to raise the financial cost of sustained military campaign. The move reflects growing frustration within the White House over Moscow’s refusal to negotiate in Ukraine.

These actions have also placed specific pressures on India, one of the largest importers of Russian crude, to halt its purchases from Rosneft and Lukoil or risk facing similar U.S. sanctions. New Delhi now faces the challenge of balancing the economic benefits of discounted Russian oil against rising diplomatic tensions with Washington. President Trump said Prime Minister Modi has “assured me they will not be buying oil from Russia,” calling it a “big step” in his campaign to cut off Moscow’s energy revenues.

In the markets, as expected, the announcement sent shockwaves through global oil with Brent Crude seeing a 5 percent increase in price due to concerns over supply chain disruptions. Energy stocks gained due to the expectation of decreased supply leading to increased energy prices. Analysts continue to warn that prolonged volatility in the oil sector will lead to increased inflation worldwide creating ripple effects across global markets.