Bipartisan Congressional Effort Aims to Block Trump's Russian Diesel Deal, Seeking to Revoke Waivers and Impose Sanctions; Brent Crude Briefly Jumps Over 3%

Deep News10-17

President Donald Trump's decision to ease restrictions on Russian diesel exports has met with collective pushback from bipartisan lawmakers in Congress.

On Friday, Eastern Time, Representative Gregory Meeks, the top Democrat on the House Foreign Affairs Committee, introduced a bill backed by lawmakers from both parties. The bill aims to revoke relevant licenses already issued by the U.S. Treasury Department, prohibit future waivers, and require the government to impose sanctions on Russia's energy sector. This means Trump's policy of trying to ease energy price pressure by restoring Russian diesel supplies and advancing Russia-Ukraine negotiations is now facing continuous opposition in Congress, from the Senate to the House.

After news of the bill was released, international crude oil futures rallied late in the U.S. morning session. Early in the U.S. afternoon, West Texas Intermediate crude futures briefly approached $100.90 per barrel, up nearly 3% on the day; Brent crude futures briefly neared $109.60 per barrel, up nearly 3.5% on the day. The market needs to reassess expectations for increased Russian diesel supplies and the risk that U.S. sanctions policy toward Russia may tighten. However, oil price movements are also influenced by factors such as Middle East supply risks, so the intraday gains cannot be attributed entirely to this bill.

The Bill Aims to Revoke Diesel Import Licenses and Close the Trump Administration's Waiver Channel

The bill introduced by Meeks on Friday is called the Prohibit Corrupt Russia Oil Deals Act. According to a notice published by the House Foreign Affairs Committee and the bill text, the legislation not only targets the Trump administration's current Russian diesel transactions but also seeks to limit the United States' future ability to relax Russian energy sanctions through general licenses.

The bill's main measures include three aspects:

First, revoking existing licenses. The bill would invalidate multiple Russia-related energy general licenses previously issued by the Treasury Department's Office of Foreign Assets Control, including General License No. 135, which directly involves the sale, delivery, discharge, and import of Russian diesel, as well as other licenses involving Russian crude oil and petroleum products.

Second, prohibiting future waivers. The bill would bar the Treasury Department from continuing to issue relevant general licenses or from authorizing other activities that are otherwise prohibited by law and are typically necessary for transactions involving Russian crude oil, petroleum products, diesel, and natural gas.

Third, expanding sanctions on Russian energy. The bill would require the president, within 30 days after the law takes effect, to impose sanctions on relevant Russian entities involved in Russian oil and gas extraction, refining, or production, as well as maritime transportation of oil and natural gas. Measures would include freezing assets and restricting entry. The bill would also limit the U.S. International Development Finance Corporation from participating in investment or financial arrangements involving Russian energy assets.

In addition, the bill would expand Congress's power to review executive branch measures that ease sanctions on Russia. According to the proposal text, relevant energy sanctions relief measures would be subject to stricter congressional oversight until the U.S. Secretary of State, together with the Treasury Secretary, Defense Secretary, and Director of National Intelligence, certifies to Congress that Russia has ended the war against Ukraine and credibly committed to a just peace agreement, including compensation for Ukraine's war losses.

This means the proposal seeks to restrict not only the current batch of diesel transactions but also the Trump administration's future policy space for restoring Russian energy trade through administrative licenses.

In the notice, Meeks said the deal between Trump and Russian President Vladimir Putin cannot lower the cost of living for Americans, but will provide Russia with funds to continue attacks on Ukrainian civilians. He called on Congress to act to block the relevant agreement.

The bill was co-signed by multiple Democratic representatives, and among the co-sponsors is Republican Representative Don Bacon, reflecting a bipartisan stance against Russian diesel transactions. However, the fact that lawmakers from both parties jointly introduced a bill does not mean Congress has enough votes, nor does it mean the bill will necessarily pass.

The Senate Has Already Applied Pressure Twice This Week, With Several Republicans Breaking Ranks Drawing Attention

The latest move in the House is not an isolated event. Over the past week, Trump's Russian diesel deal has triggered continuous opposition in the Senate, and the opposing camp includes several senior Republican senators.

On Monday, some bipartisan senators publicly questioned the legality of the Trump administration's easing of restrictions on Russian diesel exports, arguing that the United States should not resume relevant energy imports while Russia continues to wage war against Ukraine. They demanded that the government withdraw the decision and stressed that Congress's previously established restrictions on Russian energy cannot be bypassed by a presidential transaction arrangement.

On Tuesday, opposition further expanded. According to reports, 12 senators, including 6 Republicans, sent a letter to Trump demanding the agreement be revoked. They argued that easing restrictions would allow Russia to sell diesel more freely to global markets, provide funding for Putin's government to continue the war, and harm the security interests of the United States and its allies.

The 12 senators include Republicans Mitch McConnell, Thom Tillis, Susan Collins, Alan Armstrong, Lisa Murkowski, and John Cornyn, as well as 6 Democrats. Some Republican senators had previously joined Democrats in issuing statements urging Trump to change policy direction.

It is worth noting that Trump faces more than just congressional political criticism over the diesel deal. Reuters previously reported that under a Russia sanctions law signed last month, Trump must decide by October 18 whether to impose broader sanctions on Russian energy or grant a waiver on national interest grounds.

Therefore, the timing of the new House bill on Friday is especially sensitive: on one hand, congressional opponents are trying to use legislation to limit the executive branch's waiver authority; on the other hand, the Trump administration is about to face a sanctions decision deadline under existing law.

If Congress advances legislation, the White House's policy options on Russian energy will be more constrained. But before the bill formally passes, whether the Trump administration can continue to implement the diesel deal based on existing executive authority remains a key issue to watch.

From Lowering Energy Costs to Sanctions on Russia, Trump Faces a Dilemma

Trump's Russian diesel deal was originally positioned as an arrangement balancing energy prices and diplomatic negotiations: easing fuel market pressure by restoring some Russian diesel supplies, while sending a signal of cooperation to Moscow to push Russia and Ukraine back to the negotiating table.

But developments over the past week show that the political cost of this policy is rising. Bipartisan senators have successively demanded the agreement be revoked, and the House has introduced a bill that would legally revoke relevant licenses, limit future waivers, and expand sanctions on Russian energy.

For the Trump administration, continuing to push the agreement could intensify domestic partisan divisions and trigger disputes over how existing sanctions laws are enforced; withdrawing the agreement could weaken the White House's policy vision of using energy trade to ease supply pressure and gain negotiating space.

What the market is watching is no longer just how much additional diesel Russia can export, but whether the U.S. government can fulfill its earlier supply commitments and whether Congress will pass new legal measures to change the conditions for implementing the deal.

The House proposal on Friday has not yet become law, but it has turned Trump's Russian diesel deal from a controversial administrative decision into a policy conflict in which Congress is trying to block it through legislation. As the October 18 deadline for the Russia sanctions decision approaches, how the White House handles the Russian energy issue next will affect U.S. domestic politics, Russia-Ukraine negotiations, and the international crude oil market all at once.

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