U.S. companies are turning away from Russian diesel; tankers may head to Brazil
American companies are reluctant to purchase Russian diesel due to legal and reputational risks. Despite the agreement between Donald Trump and Vladimir Putin on fuel supplies, businesses are concerned about the potential consequences of such deals.
Due to a lack of buyers in the U.S., tankers carrying Russian diesel may change course and ultimately deliver their cargo to Brazil.
Why U.S. Businesses Are Shying Away from Purchases
According to the publication, sources in the fuel market claim that representatives of the Donald Trump administration are unofficially encouraging American companies to buy Russian diesel. However, companies are unwilling to take on the risks associated with trading in Russian fuel.
Concerns are mounting ahead of the U.S. midterm congressional elections, scheduled for November 3. If the Democrats win, companies could face legal action for purchasing fuel from Russia, which remains subject to sanctions.
The analytical firm Rapidan Energy Group, citing a client note reviewed by the publication, noted:
“Moscow and Washington are still trying to find buyers, but we wouldn’t be surprised if the shipment ultimately ends up in Brazil.”
Other industry analysts interviewed by the publication also speculate that the Russian diesel will ultimately be delivered to Brazil.
Between October 16 and 22, three tankers carrying diesel fuel departed from the Baltic port of Primorsk bound for the United States: the TALISMAN, which is subject to U.S. and EU sanctions; the LERUO, which is subject to U.K. and EU sanctions; and the AGIOI FANENDES.
In total, the vessels are carrying 924,000 barrels of fuel—less than one-third of the U.S. transportation sector’s daily consumption. They are expected to arrive at their destinations between November 7 and 11. In total, 4.8 million metric tons of diesel are to be delivered to the U.S. under the agreements.
According to Reuters, the tanker LERUO changed its destination to an unspecified “Atlantic Coast—awaiting instructions.” The other two vessels initially listed traditional ports of arrival in Turkey and Brazil.
The U.S. is trying to block the shipments
New Jersey Governor Miki Sherrill, a Democrat, is threatening to prevent Russian diesel fuel from entering the ports of New York and New Jersey. She called the agreement between Trump and Putin on diesel fuel supplies corrupt and illegal.
“The Trump-Putin deal on diesel fuel is corrupt and illegal, and I am looking for ways to prevent it from arriving at a port in New Jersey.”
In addition, a bipartisan group of U.S. lawmakers called on companies not to facilitate the purchase, transportation, import, unloading, storage, financing, or distribution of diesel fuel of Russian origin.
On October 27, members of Congress sent letters to the largest U.S. banks, ports, and fuel distributors. In the letters, they warned of potential lawsuits and legal liability for transactions involving Russian diesel.
Such shipments may violate U.S. law
The import of Russian diesel fuel into the U.S. is explicitly prohibited by the Ending Importation of Russian Oil Act, passed in 2022. The law stipulates that the president may lift the ban on Russian fuel imports only under specific conditions: Russia must cease its aggression against Ukraine and stop posing a threat to any NATO country. To lift the restrictions, the president must also notify Congress in writing 90 days in advance.
Despite this, in mid-October, Donald Trump lifted sanctions on Russian diesel in an effort to lower fuel prices in the U.S. and around the world. He reached an agreement with Vladimir Putin on diesel supplies; however, the legislative ban remains in effect: Trump did not notify Congress of this decision, and the conditions required by law for lifting the restrictions have not been met.
The U.S. Congress has called this move dangerous. American lawmakers warn that the agreements could provide Moscow with additional revenue, which Russia could use to finance the war against Ukraine.
This was reported by The Washington Sun.
A U.S. senator has called on shipping companies to turn back tankers carrying Russian diesel fuel.
As a reminder, U.S. President Donald Trump announced on October 9 that an agreement had been reached with Russian dictator Vladimir Putin regarding the supply of millions of metric tons of Russian diesel fuel to the American and global markets.
