World

US Considers Relaxing Sanctions on Russian and Iranian Tankers to Tackle Diesel Price Surge

By Sanchari Ghosh

The United States is weighing the possibility of easing restrictions on oil tankers linked to Russia and Iran as the Trump administration seeks to curb rising diesel prices ahead of the November midterm elections. The proposal, raised by Energy Secretary Chris Wright at the World Petroleum Conference in Riyadh, would allow blacklisted vessels to be sold to legitimate operators and could lift sanctions that currently prevent them from operating in global markets. A Treasury Department official said the Office of Foreign Assets Control may approve such transactions on a case‑by‑case basis, provided buyers are legitimate and the ships are restored for lawful commercial use.

The move comes amid data showing U.S. consumer inflation rose to 3.7% in September, with fuel price rebounds affecting the economy. The White House has urged allies to release more diesel and threatened an export ban, while President Trump signed an executive order permitting tax‑free red diesel on public roads. Despite these efforts, diesel prices remain high, averaging $6.31 a gallon at the pump on Thursday, just below a recent record of $6.53.

The International Energy Agency warns of a global diesel shortage that could last until mid‑2027. Analysts question whether easing tanker sanctions would significantly lower prices. Energy Aspects estimates that 13% to 19% of the global tanker fleet is under U.S. sanctions, but many of those vessels are old and in poor condition, limiting their commercial contribution. Research group Kpler expects the measure to have virtually no impact on the current tanker crisis, arguing that higher fuel prices are driven primarily by heightened war risks in the Middle East rather than vessel shortages.

For Russia, relaxing restrictions could open another channel for oil trade and potentially weaken the economic pressure intended to constrain Moscow’s war effort. Italy’s Prime Minister Giorgia Meloni criticized Trump’s plan to buy diesel from Russia, calling it a “very risky choice” and noting that it undermines international pressure on Vladimir Putin to end the war in Ukraine. For Iran, the proposal reflects Washington’s effort to contain fuel costs amid conflict‑related disruption in the Middle East. If tanker restrictions are relaxed without materially improving supplies, the administration could face criticism for weakening sanctions without delivering meaningful relief at the pump.