Trump's Russia sanctions act waiver hits oil, angers Congress
An executive order waived the duties and most sanctions in a new Russia law, oil slipped on Monday, and lawmakers from both parties objected.
A Russia sanctions act waiver signed by President Donald Trump on Friday, Oct. 16, shelved most of the penalties in a law Congress passed last month, and oil markets treated it as a supply story. Brent crude fell 1.7% to $107.95 a barrel in Asian trade on Monday, while U.S. crude lost 0.8% to $100.62, Reuters data show.
What happened
The executive order implements the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 and then waives it. On paper, it sets a 500% duty on Russian goods, a 100% duty on goods from the five largest buyers of Russian oil and gas if they make new purchases on or after Oct. 18, and a 100% duty on the top five facilitators of sanctions evasion.
Section 4 then waives all duties under sections 112 and 113 and the sanctions provisions in sections 102(a), 102(d), 102(e), 103 through 111 and 117. The waivers stay in force until the president or the secretary of state decides further action is needed. Secretary of State Marco Rubio said Trump wants 60 days "to analyze their impact on the U.S. and global economy given the pressure on global energy supplies," NBC News reported.
The move follows the Oct. 9 deal with Vladimir Putin to release Russian diesel and the Treasury's General License 135, which we covered in Russian diesel and General License 135.
Why it matters
For energy traders, the Russia sanctions act waiver removes the threat of tariffs on big buyers such as China and India, keeping Russian barrels flowing while Middle East supply is strained. Oil had jumped to a five-month high near $110 last week, so any easing of supply risk matters for inflation and for the Federal Reserve.
Treasury Secretary Scott Bessent defended the decision on NBC's Meet the Press on Sunday. "No sanctions were lifted," he said, adding that "the only thing that has been lifted is the diesel embargo." He said the United States imports about $4 billion of Russian products, $1.8 billion of it fertilizer.
Critics were not persuaded. Rep. Mike Lawler said he did not support the move, and Sen. Richard Blumenthal called it a "craven, cowardly action." Ukrainian President Volodymyr Zelenskyy said lifting sanctions was "wrong" and "only helps the Russians."
What's next
The 60-day review puts a decision around mid-December, and lawmakers from both parties have already objected. In the meantime, markets will watch whether Russian diesel cargoes actually reach U.S. ports under the general license, which runs through April 7, 2027. Polymarket puts imports by Oct. 31 at only about 3%.
Europe is part of the argument. Bessent said European buyers keep taking Russian energy and refused U.S. requests in the spring to join secondary tariffs on China and India. "Why should the U.S. go it alone?" he asked, hinting that Trump may raise the issue with European partners.
The call
Polymarket prices "US imports Russian diesel by November 30?" at about 72% No as of 08:31 MSK on Oct. 19; Yes needs consensus credible reporting of Russian-origin diesel physically delivered to the U.S. under the Oct. 9 deal or General License 135. We call No: Russian diesel will not be imported into the United States by 11:59 p.m. ET on Nov. 30, 2026. The Russia sanctions act waiver eases politics, not shipping, and no cargo has been reported so far. This is a dated record call, not investment advice.
This article is for information only and is not investment advice. Calls are editorial forecasts, logged with market odds at the time of publication and kept on the record.