China, India and the 'shadow fleet': how Trump’s proposed secondary tariffs could impact shipping

During a meeting with NATO secretary general Mark Rutte on 14 July, President Trump stated the US would impose 100% tariffs on countries that continue doing business with Moscow if a peace deal in Ukraine is not reached within 50 days. He expressed strong dissatisfaction, saying the US is "very unhappy and disappointed with Russia."

However, industry experts doubt the feasibility of the proposal. “I’m sceptical this policy will ever be implemented, considering Trump’s historical approach to Russia,” said Banchero Costa head of research Ralph Leszczynski, speaking to Riviera. He added any effective policy targeting Russian oil exports would likely drive up oil prices – something the current US administration is actively trying to avoid.

Should the US move forward with secondary tariffs, analysts believe the cost of Russia’s primary export commodities would increase. Intermodal head of research Yiannis Parganas, pointed to oil, natural gas, coal and iron ore as likely targets.

Focus on China and India

Turning to oil and the tanker market – one of the most affected sectors since the beginning of the war – Mr Leszczynski explained such tariffs would primarily affect three major importers: India, China and Turkey. “Over 50% of Russian oil exports currently go to India, around 30% to China, and the remainder to Turkey, North Africa and southeast Asia,” he said.

“This means India and China would have to find alternative sources for the lost Russian cargoes, which could significantly impact tonne-mile demand,” added Mr Parganas.

However, he cautioned this shift may not benefit the tanker market. “Lower Russian prices have fostered new trade patterns that lengthened sailing distances and increased tonne miles.” Disrupting that could reduce demand.

AXSMarine shipping analyst Nikolas Zannikos expects China and India to continue purchasing Russian oil despite the potential implementation of secondary tariffs, as there appears to be no compelling incentive for them to switch suppliers.

However, Mr Zannikos noted India might reduce its intake of Russian crude due to the deteriorating security situation in the Bab El-Mandeb Strait, which is currently disrupting transits. This could prompt a redirection of cargoes either toward the Arabian Gulf or the Atlantic Basin. He explained the former scenario would be negative for tonne miles, while the latter could be marginally positive. Overall, he expects the net impact on the tanker market to be neutral.

Interestingly, China may already be adjusting its oil sourcing. According to Banchero Costa data, Chinese imports of Russian oil are down by one-third year-on-year in 2025. Meanwhile, its imports from Brazil, Canada and West Africa are increasing.