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US temporarily lifts restrictions on Russian oil purchases
The Trump administration announced a one-month waiver allowing countries to buy Russian oil previously stranded at sea due to sanctions, a move Moscow hailed as a step toward stabilizing global energy markets but critics condemned as a financial lifeline for the Kremlin.
Policy reversal sparks controversy
Treasury Secretary Scott Bessent framed the decision as a "tailored, short-term" measure to mitigate economic fallout from the U.S.-Israel conflict with Iran. The waiver contrasts sharply with Washington's prior stance, including a 50% tariff imposed on Indian oil imports in August over accusations of Russian oil purchases funding Ukraine's war.
Kremlin economic envoy Kirill Dmitriev called the policy shift "inevitable," arguing Russia's role in global energy stability justified further sanctions relief. Meanwhile, sanctions campaigner Bill Browder told the BBC the move would "enrich Vladimir Putin and prolong the war."
Economic impact on Russia
Analysts estimate the waiver could boost Russian oil exports by $10 billion monthly, with half flowing directly into state coffers as tax revenue. Benjamin Hilgenstock of the Kyiv School of Economics warned the decision amounted to "a serious bailout" for Putin's regime, which has faced mounting economic pressure.
Russian oil exports hit their lowest levels since the 2022 invasion in February, but Hilgenstock said the U.S. move would "help significantly," potentially restoring Russia's financial comfort if the Iran crisis persists.
Global oil market dynamics
The Strait of Hormuz, a critical chokepoint for one-fifth of global oil trade, has been effectively closed, disrupting supplies and driving price surges. Warren Patterson of ING Bank noted the U.S. waiver would "only scratch the surface" of the crisis, emphasizing the need to reopen the strait to resolve market instability.
Asian nations, particularly India, are expected to absorb the newly available Russian oil, compensating for lost Persian Gulf supplies. The move has raised concerns among Western leaders about inflationary pressures from rising energy costs.
Western divisions and symbolic shift
Pro-Ukraine advocates argue the waiver undermines the Western consensus on pressuring Russia. Alexander Kirk of Urgewald called it a signal that "the West will blink" if Moscow waits long enough. Germany's Chancellor Friedrich Merz revealed six of seven G7 leaders opposed easing sanctions, while UK Energy Minister Michael Shanks warned Putin would exploit the opportunity to fund his "war machine."
The Centre for Research on Energy and Clean Air (CREA) predicted Russia would use the waiver to clear backlogged tankers and ramp up production, reversing recent slowdowns caused by storage constraints. Isaac Levi, a CREA analyst, said the crisis in the Strait of Hormuz had exposed the limits of sanctions, likening it to an "act of God" that disrupted global oil market workarounds.
Critics urge reversal
Browder urged other governments not to follow the U.S. lead, calling the waiver "nonsensical" given that China, India, and Turkey have continued purchasing Russian oil regardless. He argued the policy change would only funnel more money into Putin's war efforts while benefiting those nations' economies.
"There is not much that we can do until [the Hormuz crisis] is over."
Benjamin Hilgenstock, Kyiv School of Economics
