The proposed legislation targets two things at once: Russia's energy revenue and Iran's sanctions loopholes.
If it passes, President Trump would gain the authority to put a tariff of up to 500% on any Russian goods coming into the United States. That is not a number you see every day. For comparison, the highest tariff the US typically slaps on anything is around 25% for certain steel and aluminum imports.
Beyond that, the bill would let Trump impose a 100% tariff on the five countries that buy the most Russian crude and natural gas. Those same top five countries that help Russia dodge existing energy sanctions would also be on the hook. The tariff authority would last five years - a change made at the last minute to limit the window.
Additionally, the bill renews the Iran Sanctions Act of 1996, originally slated to end in 2026. Under the bill, it would run through 2031, giving the US additional leverage against Tehran.
The bill's main champion was Senator Lindsey Graham, who pushed it before his death. President Trump has signaled support, and the White House helped negotiate broad waivers that give the president a lot of room to decide not to use the new powers at all.
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Supporters say the bill is needed to close loopholes that let Russia keep selling energy worldwide, fueling its war against Ukraine that started with the full-scale invasion in 2022.
But not everyone is on board. Democratic Senator Ron Wyden and Representative Richard Neal issued a joint statement on July 14 calling the bill "a prescription for bedlam and higher tariffs." Their worry is that the president could use these new powers as a blank check to raise tariffs on everyone, not just Russia's allies. Wyden said there's "no question" the US must act stronger against Russian energy buyers, but this approach goes too far.
Obsidian Risk Advisors' managing principal Brett Erickson highlighted the global energy market, noting that "at a time when global energy markets remain under significant strain, further restricting supply risks imposing disproportionate costs on countries that are already bearing the economic consequences of today's energy crisis."
The bill could also rattle relationships with two big buyers of Russian energy: China and India. Trump already placed a 25% tariff on Indian goods last year over India's purchases of Russian oil, though he later lifted it as part of a US-India trade deal. India is one of the top five buyers, and China is the biggest.
The Senate has a procedural vote scheduled for late Tuesday, July 28, 2026. The Senate is widely expected to approve the bill this week. But the House is in its August recess, so even if the Senate approves it, the measure will not become law until at least September.
The bigger question is whether the White House would ever actually use these powers. The broad waivers the administration negotiated give Trump wide discretion to skip the penalties entirely. So the bill could be more of a threat than a real policy shift - or it could open the door to fresh trade fights.
For investors, this adds another layer of unpredictability to energy markets. Oil and gas prices have already been jumpy. A 100% tariff on top buyers like China or India could ripple through global supply chains, raising costs for everything from fuel to plastics. On the flip side, if the president never uses the authority, the bill is mostly political theater.
The catch: even the threat of such tariffs can move markets. If you have exposure to energy stocks, emerging markets like India, or companies that rely on Russian raw materials, this is worth watching. The real impact depends on whether the Senate votes yes, whether the House returns, and - most of all - whether Trump decides to pull the trigger.
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