US Supreme Court tariff ruling may allow India to keep buying Russia oil

U.S. Supreme Court issued a landmark 6-3 ruling in Learning Resources, Inc. v. Trump that effectively stripped the President of the power to use “national emergency” laws to impose punitive tariffs on countries like India for their trade with Russia.

The ruling is widely seen as a major victory for India’s energy security, as it removes the primary “financial hammer” Washington had been using to pressure New Delhi into stopping its purchases of Russian crude.

The Legal Shift: IEEPA Struck Down

For over a year, the Trump administration used the International Emergency Economic Powers Act (IEEPA) of 1977 to bypass Congress and impose sweeping duties.

• The “India Penalty”: In August 2025, Trump imposed a 25% punitive tariff on Indian goods specifically as a “secondary sanction” for India’s continued import of Russian oil.
• The “Trade Deal” Context: These tariffs were only lowered to 18% in early February 2026 after India reportedly “committed” to phasing out Russian oil in an interim trade pact.
• The Court’s Decision: Chief Justice John Roberts, writing for the majority, ruled that IEEPA does not grant the President “taxing power.” The Court held that tariffs are a form of revenue-raising reserved exclusively for Congress. Therefore, the tariffs used to coerce India (and others) were unlawful.+2

Why This Helps India’s Oil Strategy

The ruling changes the leverage dynamics between Washington and New Delhi:

1. Removal of the “Reciprocal” Threat: Without IEEPA, the administration cannot unilaterally slap a 50% “punitive” duty on Indian exports overnight if India continues to buy Russian oil.
2. Increased Bargaining Power: Indian officials are already reassessing the February 2026 Interim Trade Deal. Since the tariffs used to force India to the table have been ruled illegal, the Indian opposition (and some government sectors) are calling for a renegotiation of the clause that committed India to stop buying Russian oil.
3. Stability for Refiners: Indian refiners like Reliance and Nayara Energy now have more legal “breathing room” to continue sourcing discounted Russian Urals without the immediate fear of their non-oil exports (like pharmaceuticals or textiles) being hit by emergency U.S. duties.

The “Bridge” Tariffs (The Catch)

While the Supreme Court struck down the emergency tariffs, the Trump administration has already pivoted to a different legal tool:

• Section 122 (1974 Trade Act): Effective Tuesday, February 24, 2026, Trump imposed a new 10% global surcharge (threatening to hike it to 15%) using his authority to manage “balance-of-payment” deficits.
• The Key Difference: Unlike the 25%–50% punitive rates under IEEPA, the Section 122 tariffs are temporary (150 days), capped at 15%, and must be broad-based rather than targeted at a single country for a single policy (like buying oil).

Summary of Impact