Politics

Trump’s Diesel Deal With Putin Runs Into The Ban Congress Passed On Russian Energy

Thom Tillis/Gage Skidmore/Flickr

A group of four Republican and two Democratic senators are saying that President Donald Trump’s plan to import Russian diesel breaks a 2022 law that bans Russian energy imports.

The Treasury Department issued a license Friday allowing Russian diesel into the U.S. through April 7, 2027, after Trump said Russian President Vladimir Putin agreed to ship millions of tons of the fuel to bring down near-record prices. Two days later, a half dozen senators across both parties said the deal violated a Biden-era law signed months after Russia invaded Ukraine in 2022.

“Congress was clear: the U.S. should not import oil from Russia until it ends its aggression against Ukraine and ceases threats against our NATO Allies,” a bipartisan group of senators said Sunday. “President Trump’s decision to allow Russian diesel imports to the U.S. runs directly counter to that law.”

“The United States should not provide Putin with a financial lifeline while Russia continues to kill Ukrainian civilians. The Administration must immediately reverse course,” the senators added.

They also said the administration failed to consult Congress or submit the explanation the law requires.

The statement’s signers included Republican Sens. Susan Collins of Maine, Lisa Murkowski of Alaska, Thom Tillis of North Carolina and John Curtis of Utah, along with Democratic Sens. Jeanne Shaheen of New Hampshire and Richard Blumenthal of Connecticut. All four of the Republicans who signed the statement are widely considered to be from the party’s moderate faction.

The offices of Tillis and Shaheen did not immediately respond to the DCNF’s requests for comment. Treasury did not immediately say whether it consulted Congress before issuing the license.

The Treasury Department referred the DCNF to an Oct. 10 post on X from its Office of Terrorism and Financial Intelligence, which said, “The granting of this general license is consistent with similar actions previously taken by OFAC and is in compliance with all applicable laws.”

The Ending Importation of Russian Oil Act, which President Joe Biden signed in April 2022, bans imports of Russian energy products. The president can lift the ban only by certifying to Congress that Russia has reached an agreement, accepted by Ukraine, to withdraw its forces and end hostilities, among other conditions.

The law also requires the president to consult congressional committees and send them a report explaining the decision at least 45 days before that certification. The ban stays in place for 90 days after the certification, and Congress can block its end with a joint resolution of disapproval.

“It is a bizarre deal and many people in the industry doubt whether any substantial diesel will make its way from Russia to the U.S.,” Tom Kloza, chief energy adviser at Gulf Oil, told the Daily Caller News Foundation.

“This deal will provide 3 or 4 billion dollars to the Russian war machine,” retired Rear Adm. Mark Montgomery, a senior fellow at the Foundation for Defense of Democracies, told the DCNF.

Diesel averaged $6.27 a gallon nationally Monday, up from $3.67 a year earlier, according to the American Automobile Association (AAA).

Tillis said in an interview that aired Sunday on NBC’s “Meet the Press” that there is a legitimate case that the president is not following the law if the administration goes through with the plan, the Associated Press reported.

“We were very clear that Russia is the aggressor. Russia is the one who can end this war by backing out of territory that they occupied,” Tillis said.

Republican Sen. John Barrasso of Wyoming said on CBS’s “Face the Nation” on Sunday that Trump is focused on lowering energy costs. “The president is balancing and has to make tough decisions,” Barrasso said.

Trump wrote Friday that Russia would “immediately supply over 300,000 Tons of Diesel Fuel” to American and global markets, followed by 500,000 tons in November and 1 million tons after that. He said another 3 million tons would follow, depending on the condition of Russia’s refineries.

Montgomery said the first few months of shipments would bring Russia about $1.5 billion and the final tranche about $2 billion, money he said “pays for a lot of ballistic and cruise missiles” and drones.

“This is an embarrassing double standard and will weaken our leverage with India and China and even the EU in getting them to adhere to sanctions,” Montgomery said.

Trump’s announcement came less than a month after he signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, which directs him to impose substantial tariffs on the top importers of Russian oil or natural gas, the Associated Press reported.

“In the five years before Russian diesel was banned (by sanctions) the country only moved about 11,000 barrels per day on average to the U.S.,” Kloza said. “This compares with a U.S. need of nearly 4-million b/d and a global market for 30-million barrels per day.”

The first three shipments Trump described, totaling 1.8 million tons, would cover about 3.7 days of U.S. diesel use, according to an Energy News Beat analysis of Energy Information Administration data.

Kloza said drone warfare “has knocked out about 7-million barrels per day of global refining” and that Russia “has not been exporting any molecules since summer.”

“It is doubtful that they have fuel to export to the U.S. or other customers,” he said. “Throughout the industry, this ‘promise’ of Russian diesel is viewed as dubious.”

Kloza said diesel prices fell about 8 cents a gallon Friday after the deal was announced but are “back in positive territory today around the globe.”

“Unless conflicts in the Persian Gulf, Russia, and Red Sea give way to peace, we are flirting with numbers similar to those we see today ($6/gallon and higher),” Kloza said of prices this winter. “Crunch time comes with winter weather. Diesel and heating oil are essentially the same molecules.”

Asked whether Russian diesel would meaningfully lower U.S. prices, Stuart Turley, president and CEO of Sandstone Group, told the DCNF, “No, but it is a help because it gets President Putin to the table.” He called the question “the tip of the iceberg of the entire problem.”

“There’s only two ways diesel and gasoline prices can come down,” Turley said. “One, demand destruction. Number two, … more refineries. It takes decades to build refineries.”

Turley told the DCNF in a statement that the administration should instead use the Defense Production Act to expand U.S. refining, saying the law “is the right tool, and now is the time.”

“Use it as a checkbook and a referee, not a press release,” he added.

He also urged a wider Jones Act waiver, which he called “critical to keeping prices from skyrocketing,” especially on the East and West Coasts.

“High diesel prices is the inflationary impact to the United States economy that the U.S. Treasury nor the Fed can impact,” Turley told the DCNF in an interview, adding, “Buckle up. We’re in for a rough ride.”

The Kremlin said after Putin and Trump spoke Friday that “the Russian side reaffirmed its readiness to supply oil and oil products to the American and world markets.”

The Treasury license does not authorize any debit to accounts at U.S. financial institutions held by Russia’s central bank, its National Wealth Fund or its Ministry of Finance, according to the license text.