Trump Announces Diesel Deal with Russia
On Friday, President Donald Trump announced via Truth Social that Russian President Vladimir Putin would promptly place hundreds of thousands of tons of diesel fuel on the world market, a step Trump said would push diesel prices lower. At the same time, the Treasury Department revealed it would relax sanctions on Russia until April 7, 2027, to enable the fuel shipments. According to a Treasury statement on X, the Office of Foreign Assets Control granted a temporary general license permitting Russian diesel supplies globally. A Treasury website document authorized the sale, delivery, offloading, or importation of diesel of Russian Federation origin until 12:01 a.m. EDT on that date.[S1][S2][S3][S4][S5][S6][S7][S8]
Putin separately stated that he had told Trump Russia was prepared to provide oil and petroleum products to the United States and world markets. He gave no details, however, on when such deliveries might start or how much fuel would be involved. Alexander Novak, Russia's deputy prime minister, told the state news agency TASS that Moscow would waste no time in ending its export ban following the Trump-Putin understanding. The Kremlin had banned diesel exports in July after several Ukrainian strikes on Russian energy facilities earlier in the year, and the prohibition had been prolonged through the end of October.[S1]
Diesel Prices Surge Amid Global Conflicts
Diesel prices have climbed nearly 70% since the Iran war began in February, and economists caution that the increases will fuel broad inflationary pressures across the world economy. Over recent weeks, intensifying fighting in the Russia-Ukraine war has driven diesel even higher, with the fuel setting new all-time highs repeatedly for several weeks. Following Trump's announcement, diesel futures dropped 4% on Friday, yet they are still up more than 110% since the year began. Crude oil prices hardly moved in comparison; Brent crude was trading near $104 a barrel on Friday, a decline of only 0.3% for the day.[S1]
Zelenskyy Criticizes Sanctions Relief
Ukrainian President Volodymyr Zelenskyy called Trump's decision to loosen diesel sanctions on Friday a clear sign of weakness. In his view, it benefits Russia, enabling it to kill more people, prolong the war, show even less regard for America, and cause greater losses and destruction worldwide. Only hours before Trump's announcement, Zelenskyy had received a group of U.S. senators at the presidential palace in Kyiv. He said Ukraine can defend itself against this terror only through joint efforts, and the talks covered ways the United States could help save lives. He stressed that political will is essential and that leadership must now be shown by completely halting the financial flows that sustain Russia's war effort.[S1]
Trump has openly urged Ukrainian President Volodymyr Zelenskyy to halt attacks on Russia's diesel refinery facilities. Speaking to reporters recently, Trump said his concern with Ukraine and Russia is that much of the diesel originates in Russia and Ukrainian forces are striking those plants. He recounted asking Zelenskyy to stop hitting the diesel facilities, arguing this is what is pushing diesel costs up, and said Ukraine must cease. On Sept. 14, Trump asserted that Zelenskyy and Putin had reached an understanding to halt strikes on energy infrastructure. Zelenskyy rejected that claim, telling CBS News he would only stop attacking oil and gas targets if Russia accepted identical conditions. Meanwhile, the Kremlin has stepped up attacks on Ukrainian cities and critical infrastructure throughout this summer and fall.[S1]
Previous Attempts and Ongoing Talks
Trump has previously attempted to employ U.S. sanctions relief for Russia as a way to curb climbing oil prices. This spring, the Treasury Department granted a set of 30-day waivers for Russian oil already at sea. Those waivers lapsed and had little effect on the path of oil and gas prices, which have kept climbing for months. Trump's latest announcement coincided with Ukrainian negotiators leaving for the United States to begin a fresh round of talks aimed at ending the war with Russia. Special envoy Steve Witkoff and Jared Kushner, Trump's son-in-law, were expected to head those discussions. As of late Friday, it remained uncertain whether the talks would proceed as scheduled given the new sanctions waiver.[S1]
