Trump said Russian President Putin had agreed to release 300,000 tonnes of diesel immediately, followed by 500,000 tonnes in November and a further million tonnes after that. The US Treasury is suspending sanctions on Russian diesel exports until April 7 as part of the arrangement. The announcement on Friday drew sharp criticism from Ukraine's President Volodymyr Zelensky, who condemned the move as a gift to Putin that amounts to backing continued war rather than peace.
Trump has been under pressure to tackle rising fuel costs, which have damaged public confidence and Republican prospects in the upcoming midterm elections. The average diesel price in the US currently stands at $6.28 a gallon, down from a record high of $6.53 at the end of September, according to the AAA. An Iran conflict that began in February has pushed global energy prices higher.
Investment strategist Tim Armitage at Quilter Cheviot questioned whether the deal would meaningfully reduce prices for American consumers. He calculated the first delivery equated to approximately 2.25 million barrels, whilst daily US consumption was around 3.8 million barrels. Analysts have also raised doubts about Russia's capacity to deliver the promised volumes, given that Ukrainian strikes have reduced its diesel production by nearly 30 per cent.
The UK government said it would maintain its sanctions pressure on Russia and continue supporting Ukraine. Zelensky defended Ukrainian strikes on Russian oil refineries as responses to years of Russian attacks on Ukraine's energy infrastructure. The agreement represents a shift from Trump's earlier support for legislation imposing sanctions on nations importing Russian oil and gas.