Donald Trump and Vladimir Putin. Image Credit: The White House / Kremlin.ru

• OFAC issues General License 135 authorising sale, delivery, offloading and import of Russian-origin diesel through April 7, 2027
• Trump says Russia will release up to 4.8 million tonnes, starting with 300,000 tonnes "immediately"
• Russia's own diesel export ban has been in place since July 8
• EU and UK import bans and the $100/bbl product price cap remain fully in force

The US has suspended its sanctions on Russian diesel for six months after Donald Trump said Vladimir Putin had agreed to release up to 4.8 million tonnes of the fuel on to the world market.

The Office of Foreign Assets Control (OFAC) issued General License 135 on Friday, authorising all transactions under the Russia sanctions regulations "related to the sale, delivery, offloading, or importation, including importation into the United States, of diesel fuel of Russian Federation origin" until 12:01 a.m. eastern time on April 7, 2027.

"Today, at President Trump's direction, the Office of Foreign Assets Control (OFAC) is immediately issuing a temporary general license to allow the supply of Russian diesel to the global market," the Treasury said in a post on X.

Trump said on Truth Social that, following a call with Putin, Moscow had agreed to supply 300,000 tonnes of diesel "immediately", a further 500,000 tonnes in November and another 1 million tonnes "immediately thereafter", with an additional 3 million tonnes "within a short period of time" depending on "the condition of their Diesel Refineries".

"Between our TOTAL CONTROL of the Strait of Hormuz, and this great announcement on Russian Energy, Diesel Prices for Americans and, indeed, the World, will be COMING DOWN, IN RECORD NUMBERS, AND FAST!" he wrote.

Russia has banned diesel exports since July 8, after Ukrainian drone strikes on its refineries cut output, and the ban had been extended to the end of October.

US pump diesel hit a record $6.53 a gallon in recent weeks, and the wholesale price in New York harbour fell about 4.5% to $4.67 a gallon on the announcement, according to the Financial Times.

Marine gasoil prices have followed the trend, with Ship & Bunker data putting New York LSMGO prices under $1,000/mt in June, but then rising to over $1,600/mt last month before falling into the lower $1,500's this week.

Today's licence waives US restrictions only and how this interfaces with other global sanctions remains to be seen.

"Anyone considering buying or selling Russian diesel should keep in mind that UK and EU sanctions remain fully in force," Steve Simms, principal at Simms Showers LLP, told Ship & Bunker.

In the US itself, the Ending Importation of Russian Oil Act of 2022, which wrote the ban on Russian energy imports into law, remains in effect with today's OFAC General License considered a "temporary executive waiver", Ship & Bunker understands. 

The EU and the UK have banned imports of Russian refined products since February 5, 2023, and their shipowners, traders and insurers may only carry or service Russian diesel to third countries at or below the $100/bbl price cap for premium products.