The Aporia
US President Donald Trump announced that Russian President Vladimir Putin agreed to supply the US and global markets with millions of tons of diesel fuel. The deal includes an immediate delivery of over 300,000 tons, followed by additional shipments: 500,000 tons in November and 1 million tons immediately after. Russia will also deliver another 3 million tons based on the condition of its refineries, which have been damaged by attacks during the war in Ukraine.
To facilitate this agreement, the US Department of Treasury temporarily lifted sanctions related to Russian diesel fuel transactions until April 7, 2027. This move aims to lower soaring global diesel prices that are near record highs ahead of the November congressional elections, which will determine control of Congress. The decision marks a reversal of previous sanctions imposed on Russia's energy sector following its invasion of Ukraine in 2022.
Diesel prices have surged by about 70% since the beginning of the US-Israeli war with Iran this year, impacting sectors such as agriculture and transportation. Trump’s announcement is part of his efforts to address high fuel costs amid low approval ratings ahead of the midterms.