Donald Trump has suspended a package of Russia sanctions, including penalties targeting countries that buy Moscow’s oil and gas, while European Union members continue to import substantial quantities of Russian fuel.
The US president signed an executive order waiving the measures on Friday, saying the decision was in the national interest. The suspension will remain in place until his administration decides that further action is appropriate.
The sanctions had been approved by Congress last month with bipartisan support. They included tariffs of up to 100 per cent on goods imported into the US from the five largest buyers of Russian crude oil or gas, including China and India.
They could also have imposed equivalent penalties on countries judged to have knowingly purchased Russian energy, or to be among the five biggest countries helping Moscow evade restrictions on its oil exports.
The decision has prompted criticism in Ukraine, Europe and among US officials who argue that easing pressure on Moscow rewards the Kremlin while Russia continues its war against its neighbour.
US Congressman Don Beyer described the move as a “surrender to Putin” that “betrays our Ukrainian partners and defies clear congressional intent”. Ukraine’s President Volodymyr Zelenskyy has also condemned a separate US-backed deal to release Russian diesel on to international markets, calling it “a gift” to Vladimir Putin that would help finance the war.
Trump’s Russia sanctions waiver benefits major energy buyers
Vasily Astrov, an economist at the Vienna Institute for International Economic Studies, said the Russian government was likely to be the biggest beneficiary of the waiver because its oil would not need to be sold at such a steep discount.
He estimated that about 60 cents of every additional dollar added to the price of a barrel of Russian oil would reach state coffers. Kirill Dmitriev, a Russian official and envoy for Mr Putin, called the decision “an important and truly historic moment”.
China and India, the largest buyers of Russian crude, are also expected to face less risk of secondary US penalties. They bought Russian crude worth €6 billion and €3.6 billion respectively in September, according to figures from the Centre for Research on Energy and Clean Air.
Mr Trump has said the move, alongside a deal to bring Russian diesel into global markets, could help reduce energy prices for US consumers ahead of November’s midterm elections. Under the agreement, 300,000 tonnes of diesel were due to enter US and global markets immediately, followed by 500,000 tonnes in November and 1 million tonnes afterwards.
Valdis Dombrovskis, the European Union’s economy chief, questioned whether the volumes would have a meaningful effect. He said they were “not of any macroeconomic significance” and that there were “strong doubts whether Russia is even able to supply those volumes” to US quality standards.
European imports of Russian gas continue
European leaders have criticised Washington’s decision to lift the diesel sanctions temporarily. However, the EU continues to buy Russian gas despite maintaining a near-blanket ban on Russian oil and planning to phase out gas imports next year.
More than 12 million tonnes of Russian Arctic liquefied natural gas were transported to EU ports between January and September, according to the German research group Urgewald. That was a 9.5 per cent increase on the same period last year.
EU countries imported €817 million worth of Russian pipeline gas and €615 million of liquefied natural gas in September, figures from the Centre for Research on Energy and Clean Air show.
France was the largest EU importer of Russian LNG, buying €446 million worth, followed by the Netherlands with €116 million. French LNG imports rose by 103 per cent from the previous month.
French President Emmanuel Macron, one of the most vocal critics of the US diesel agreement, said it sent “a negative message” and would have no impact on global prices.
Hungary was by far the biggest EU buyer of Russian pipeline gas in September, importing €414 million worth. Slovakia imported €161 million and Bulgaria €132 million, according to the same data.
