US to End Sanctions Waiver for Russian Oil Purchases

The administration of US President Donald Trump is preparing to terminate a sanctions exemption that permitted nations, including India, to purchase Russian oil transported by sea. The waiver had been extended for one month as a stopgap to mitigate oil supply shortages and rising prices triggered by Iran's blockade of the Strait of Hormuz.

Treasury Secretary Scott Bessent stated earlier that he would not renew the general license authorizing the purchase of Russian oil stored on tankers. As of early evening Washington time, no renewal notice had been posted on the Treasury Department's website, and a department spokesperson declined to offer further comment.

Senators Urge Against Renewal

Two prominent Democratic US senators, Jeanne Shaheen and Elizabeth Warren, urged the Trump administration on Friday not to extend the waiver. They argued that the exemption provides revenue to Russia to sustain its war in Ukraine and that there is no evidence it lowers fuel costs for American consumers.

The previous extension was part of a broader set of measures by the Trump administration aimed at controlling global energy prices, which surged sharply during the conflict with Iran. Those steps included drawing from the Strategic Petroleum Reserve and a temporary exemption from a shipping regulation known as the Jones Act.

Limited Impact on Gas Prices

President Trump has also expressed support for suspending the federal gasoline tax of 18.4 cents per gallon. However, these actions have done little to calm gasoline prices in the United States, which currently stand at around $4.50 per gallon—the highest level since 2022.

Domestic and global oil prices have reached or exceeded $100 per barrel since the war erupted on February 28.

During his return trip from Beijing yesterday, Trump told reporters he discussed with Chinese President Xi Jinping the possibility of lifting sanctions on Chinese companies that purchase Iranian oil, adding that he would make a decision on the matter soon.

India is the largest consumer of seaborne Russian crude, and its purchases approached record highs in April and May following the sanctions waiver.