The latest:
Washington has temporarily lifted sanctions on Russian fuel and opened the door to buying diesel from Moscow, a reversal a month after Trump signed a sweeping Russia sanctions law. Trump said on Truth Social he reached the deal in a phone call with Vladimir Putin he described as highly successful. Diesel futures fell roughly 5% to $4.64 a gallon on the news.
Details:
- The volumes: Trump said Russia would immediately supply more than 300,000 metric tons of diesel — about 2.25 million barrels — to US and global markets, followed by 500,000 tons in November and a million tons shortly after, with up to three million more later. He tied further shipments to the condition of Russian refineries damaged by Ukrainian strikes.
- The legal step: The US Treasury issued a license permitting imports of Russian diesel until April 7, according to Reuters, temporarily suspending measures designed to deny Moscow revenue for its war in Ukraine. Washington had sanctioned Russian oil companies in October 2025.
- The reversal: The law Trump signed last month targeted Russia’s energy sector, sanctioned officials, banks and a shadow tanker fleet, barred new US investment and blocked servicing of sovereign debt. It also directed tariffs of up to 100% on the five largest importers of Russian oil and gas, exempting buyers below 15%.
- The price pressure: US diesel averaged $6.28 a gallon Thursday, according to AAA, up 70% since the US and Israel went to war with Iran on February 28. Diesel feeds agriculture, home heating and trucking. Prices stayed high despite Trump pressing allies to release emergency reserves and widening access to tax-exempt dyed diesel.
- The politics: The deal lands before the November 3 congressional elections that will decide whether Republicans keep their narrow majorities. Trump did not mention the midterms, writing that lowering prices for Americans, especially farmers, ranchers and truckers, is his top priority.
- Republican pushback: Republican Representative Don Bacon criticized the agreement on X, arguing the new sanctions should squeeze Putin’s war machine rather than reward a dictator with more money while Ukrainian civilians are being killed. Other US lawmakers also called for enforcement instead of relief.
- Kyiv’s response: Ukrainian President Volodymyr Zelenskiy called it a weak decision by strong partners, announced while a Ukrainian delegation was in the US discussing an end to the war. He said letting Russia sell fuel hands it extra war income, and that gifts to Putin would be repaid with more terror.
- Moscow’s framing: Putin envoy Kirill Dmitriev praised US-Russian energy cooperation on X. The Kremlin said the call ran about an hour and a half, quoted Putin saying Russia is ready to supply oil and refined products to the US and world markets, and said he would consider when to resume peace talks.
- Analysts’ doubts: Rory Johnston of CommodityContext said he could not overstate how absurd the deal is, noting Russia normally exports far larger diesel volumes when its refineries are not under attack. Jim Mitchell of Wood Mackenzie assessed it as another channel into a volatile market rather than a solution.
- Next lever: Three industry sources said Trump will issue a directive within days pushing agency heads to bypass state and local rules limiting energy production and to invoke the Defense Production Act to lift oil and fuel output. The White House is weighing using it to expand refining capacity.
Background:
The sanctions law Trump signed last month was built to choke the energy revenue funding Russia’s war, launched in 2022. Dmitriev asked US officials during a Washington visit last month for diesel export licenses covering all major Russian oil firms, sources familiar with the matter said.
Between the lines:
The sequencing is the story: a sanctions law in September, a sanctions license in October, with a $6.28 gallon and a 70% price surge in between. Trump’s own framing names farmers, ranchers and truckers — the constituencies diesel hits hardest and the ones Republicans need on November 3. Bacon’s objection shows the cost is being paid inside Trump’s party, not only in Kyiv.
What’s next
Watch whether the 5% futures drop holds, the presidential directive on the Defense Production Act expected within days, the November tranche of 500,000 tons, and Putin’s decision on resuming peace talks.
