United States President Donald Trump has signed an executive order that sets aside newly passed Russia sanctions. He said the move serves the United States’ “national interest”.
Earlier this month, Trump also announced an arrangement to release stocks of Russian diesel into global markets. The aim, he said, was to bring down energy prices that have climbed during the US-Israel war on Iran. The US Treasury has waived sanctions on Russian diesel sales until April 2027.
Criticism of Trump’s embrace of Russian energy
Trump’s approach has drawn anger from Ukraine, European partners and many US officials. Critics say it rewards Moscow while Russia continues its four-and-a-half-year war against its neighbour.
Ukraine’s President Volodymyr Zelenskyy described the diesel arrangement as “a gift” to Russia’s President Vladimir Putin, saying it would help finance the Russian war effort.
European governments have also criticised Trump’s stance on Russian energy. Trump, in turn, has accused them of “hypocrisy”, while figures show EU countries are still importing Russian gas.
What the suspended measures would have done
In his order on Friday, Trump called off a number of Russia-related sanctions just days before they were set to take effect. The halted measures included duties on Russian goods and penalties for buying the country’s oil and gas.
These measures were part of legislation that Congress passed last month with bipartisan support. The bill is named after the late US Senator Lindsay Graham, who was an outspoken critic of Russia.
Had they taken effect, the rules could have imposed tariffs of up to 100 percent on goods entering the US from the five biggest importers of Russian crude oil or gas, including China and India. They could also have applied equal penalties to countries judged to have knowingly bought Russian oil or gas 30 days after implementation, or to be among the five leading countries helping Moscow get around sanctions on its oil sales.
According to the executive order, the waiver will remain in place until the Trump administration believes “further action is appropriate”.
Democratic Congressman Don Beyer of Virginia said the waiver amounts to a “surrender to Putin”. He argued it “betrays our Ukrainian partners and defies clear congressional intent”.
Who stands to gain from the easing of sanctions
Vasily Astrov, an economist at the Vienna Institute for International Economic Studies, said the Russian government is likely to be the biggest winner. Easing sanctions means Russian oil will not have to be sold at as steep a discount.
Astrov estimated that roughly 60 cents of every extra dollar added to the price of a barrel of Russian oil would go to the state treasury.
Kirill Dmitriev, an envoy for Putin, welcomed the US decision to waive the sanctions. He called it “an important and truly historic moment”.
Major buyers of Russian oil and gas, including China and India, also benefit because they are now less exposed to the risk of secondary US penalties.
Trump hopes the measures will help lower oil prices for American consumers before the November midterm elections. Experts, however, say that outcome is less certain.
EU economy chief Valdis Dombrovskis said the diesel arrangement is unlikely to have a significant effect on global prices. He said the volumes were “not of any macroeconomic significance”. He also questioned whether Russia could supply them and whether they would meet US quality standards.
Trump has said the deal would bring 300,000 tonnes of diesel into US and global markets “immediately”, followed by 500,000 tonnes in November and 1 million tonnes after that.
Europe’s continued imports of Russian gas and oil
The EU has a near-blanket ban on Russian oil, yet it continues to import large quantities of Russian gas. The bloc plans to phase out those imports next year.
A joint statement issued after a two-day European Council meeting in Brussels this week said the body “regrets” the US decision to temporarily lift sanctions on Russian diesel.
France’s President Emmanuel Macron, who has been among the most outspoken critics of the diesel arrangement, said on Friday that it “sends a negative message”. He also said it would have no effect on global prices.
According to the Centre for Research on Energy and Clean Air (CREA), a nonprofit think tank, China and India were the largest buyers of Russian crude oil in September. They purchased 6 billion euros ($6.74bn) and 3.6 billion euros ($4.04bn) worth, respectively. Hungary and Slovakia, landlocked EU members with exemptions to the bloc’s crude ban, bought a combined 290 million euros ($326m). Turkiye imported 172 million euros ($193m) worth of Russian crude that month.
Urgewald, a Germany-based group that researches coal companies, reported that more than 12 million tonnes of Russian Arctic LNG arrived at EU ports between January and September. That was a 9.5 percent rise on the same period last year.
CREA data showed EU countries imported 817 million euros ($918m) of pipeline gas in September, along with 615 million euros ($691m) of liquefied natural gas (LNG). France and the Netherlands were the largest LNG importers, bringing in 446 million euros ($501m) and 116 million euros ($130m) respectively. France’s LNG imports rose 103 percent from the previous month, the think tank added.
Hungary was by far the largest importer of Russian pipeline gas among EU members that month, with 414 million euros ($465m) worth. Slovakia and Bulgaria brought in 161 million euros ($181m) and 132 million euros ($148m).
