- Lawmakers criticize “benefiting” Russia amid Ukraine war.
- Analysts warn that the tools in the energy market are “almost exhausted”.
- The European Union urges no easing of sanctions against Russia.
WASHINGTON: The Trump administration has renewed a waiver allowing countries to buy sanctioned Russian oil by sea for about a month, even as lawmakers accused the administration of going easy on Moscow as the war against Ukraine continues.
The Ministry of Finance’s dispensation allows countries to buy Russian oil and oil products loaded on ships from Friday until May 16. It replaces a 30-day waiver that expired on April 11 and excludes transactions involving Iran, Cuba and North Korea.
The move is part of the administration’s effort to control global energy prices, which have soared higher during the US-Israel war against Iran. It came as countries in Asia, suffering from the global energy shock, pushed Washington to allow alternative supplies to reach markets.
Reversal of the treasury
“As negotiations (with Iran) accelerate, the Treasury wants to ensure that oil is available to those who need it,” a Treasury spokesman said.
Just two days earlier, Treasury Secretary Scott Bessent said Washington would not renew an exemption for Russian oil and another for Iranian oil that expires on Sunday.
Global oil prices fell 9% on Friday to around $90 a barrel. barrel after Iran temporarily reopened the Strait of Hormuz, an oil choke point in the Gulf. But the war has already created the worst global disruption of energy supplies in history, the International Energy Agency has said.
The war, which entered its eighth week on Saturday, has damaged more than 80 oil and gas facilities in the Middle East and Tehran has warned it could close the strait again if the recent US naval blockade of Iranian ports continues.
High oil prices are a threat to President Donald Trump’s Republicans ahead of the November midterm elections.
Trump has also faced pressure from partner countries on oil prices. A US source said partner countries on the sidelines of the Group of 20, World Bank and International Monetary Fund meetings in Washington this week had asked the US to extend the waiver.
And he talked about oil this week in a call with Prime Minister Narendra Modi of India, a major buyer of Russian oil.
The waiver on Iranian oil, issued by the Treasury Department on March 20, allowed about 140 million barrels of oil to reach global markets and helped ease pressure on energy supplies, Bessent said last month.
Permanent damage
US lawmakers from both political parties had criticized the administration over the sanctions waivers, saying they stood to help Iran’s economy while it was at war with the US and Russia, just as it was at war with Ukraine.
The exemptions could hamper Western efforts to deprive Russia of revenue from its war in Ukraine and put Washington at odds with its allies. European Commission President Ursula von der Leyen has said that now is not the time to ease sanctions against Russia.
Russian presidential envoy Kirill Dmitriev said in a social media post about the renewal of the dispensation: “US-Russian economic and energy cooperation will continue.”
He had said the first renunciation of Russian oil would free up 100 million barrels of crude, equivalent to nearly a day’s global production.
Brett Erickson, a sanctions expert at consulting firm Obsidian Risk Advisors, said Friday’s renewal is unlikely to be the last waiver Washington will issue.
“The conflict has done lasting damage to global energy markets, and the tools available to stabilize them are nearly exhausted,” Erickson said.
