- Lead. President Trump announced a deal with Vladimir Putin on October 9 to allow Russian diesel onto US and global markets, backed by a six-month Treasury sanctions waiver — a move that exposed deep fractures within the Western coalition over how to handle Russia.
- Fact. The Office of Foreign Assets Control issued General License 135, authorising transactions involving Russian diesel until April 7, 2027. Russia agreed to allow the sale of 500,000 tonnes of diesel to foreign markets effective October 10.
- Stake. The EU and UK declined to suspend their own import bans, leaving the transatlantic response to Russia visibly split at a time when Kyiv had been pressing allies for tighter — not looser — enforcement.
The Trump administration announced on October 9 that it had reached an agreement with Moscow to allow Russian diesel to flow into US and global markets, with the US Treasury issuing a general licence waiving sanctions for a six-month period. Trump described the arrangement as a response to elevated diesel prices driven by the disruption of Middle Eastern fuel supplies since the US-Israel strike on Iran in February 2026. According to CNBC, Russia committed to supplying more than 300,000 tonnes immediately, with an additional 500,000 tonnes in November and up to one million tonnes thereafter, contingent on refinery capacity. Ship & Bunker put the potential cumulative total at up to 4.8 million tonnes.
Zelenskyy’s Rebuke and the Alliance Rift
Ukrainian President Volodymyr Zelenskyy called the easing of sanctions “absolutely terrible,” arguing that Russia would use additional diesel revenue to fund its continued assault on Ukrainian cities and infrastructure. Kyiv Independent reported that Russia had partially lifted its own diesel export ban effective October 10, meaning the deal immediately translated into hard currency earnings for the Kremlin — earnings Kyiv said undermined any serious pressure campaign.
The European Union and the United Kingdom, whose separate import bans on Russian fossil fuels remain in force and were not modified in response to the US waiver, found themselves in an awkward position. Washington had acted without consulting Brussels or London, and the result was a three-way divergence: the US allowed diesel from Russia, while Europe maintained its ban and continued to argue for tighter global enforcement. CNN described the arrangement as one that “drives a wedge through the Western alliance.” This echoed a pattern of Kremlin pressure for US economic deals decoupled from the Ukraine conflict that analysts had flagged in the preceding weeks.
The Atlantic Council’s Scepticism
Analysts at the Atlantic Council questioned whether the announced volumes were large enough to make a meaningful difference to global diesel prices. Russia’s domestic refinery constraints, damaged by Ukrainian drone strikes on energy infrastructure, make it uncertain whether Moscow can fulfil the larger delivery tranches. The waiver therefore risks damaging alliance credibility without delivering the fuel-price relief Trump is seeking ahead of November’s midterm elections.
Separately, Democrats and Republicans on the Senate Foreign Relations Committee argued that General License 135 circumvents the intent of the Graham Act, which Trump himself signed in March 2026 giving Washington sweeping tariff powers over buyers of Russian energy. The legal question of whether an executive waiver can override a statutory sanctions regime is now before the Treasury’s Office of Foreign Assets Control legal counsel.
What the Deal Does Not Change
The US waiver applies only to Russian-origin diesel and runs until April 7, 2027. It does not suspend broader sanctions on Russian banks, individuals, or other energy products. The EU and UK bans on Russian fossil fuel imports, which cover crude oil and refined products including diesel, remain fully in force. Axios reported that several NATO allies privately expressed frustration at not being consulted before the announcement, raising questions about coordination on future Russia policy ahead of any potential peace negotiations over Ukraine.