US confirms to allies its intention to continue easing sanctions on Russian oil

The United States confirmed its intention to continue the process of easing sanctions on Russian oil during meetings with representatives of allied countries. This was reported by Bloomberg citing its sources. Washington communicated its position to allies last week, while assuring that the measures being taken are temporary and aimed at stabilizing the global energy market at a time when the US military operation against Iran is underway.

The U.S. Treasury Department, through the Office of Foreign Assets Control (OFAC), previously lifted sanctions on sales of Russian crude oil and petroleum products loaded on vessels prior to March 12. The issued general license allows these transactions until April 11.

Minister for Finance Scott Bessent while not ruling out further steps. According to Bloomberg, he said the U.S. „may lift sanctions on more Russian oil“, after Washington gave Indian refiners permission to buy Russian crude floating offshore.

The context of this development is complex. As PBS recalled, last October Washington imposed sanctions on Russia's two largest oil companies - Lukoil and Rosneft - as part of the pressure to end the war in Ukraine. Those sanctions remain in place, with temporary relief only for oil already loaded onto tankers.

Russian Urals crude, which earlier this year fell to around $40 a barrel due to tightened sanctions, has strengthened significantly after the Middle East war disrupted the passage through the Strait of Hormuz and the US eased some of the sanctions. Analyst Natalia Milchakova of Freedom Finance Global estimates, according to Bloomberg, that Russia could gain an additional three to four trillion rubles in oil and gas revenues if Urals averages $75-80 per barrel - this would reduce the budget deficit to about one percent of GDP.

According to Bloomberg, Russia thus benefits from two simultaneous advantages: the rise in world oil prices and the extension of the US sanctions exemption, which allows all buyers to purchase Russian oil loaded before 12 March. Any further easing of sanctions depends on whether the flow of Middle East oil through the Strait of Hormuz resumes anytime soon.

However, the temporary relief may not be as crucial for Moscow as it may seem. As an economist told PBS Sergey Aleksashenko, a former official of the Russian Central Bank, this measure does not represent significant extra revenue, because oil will eventually find buyers anyway - especially in the context of supply disruptions from the Middle East.

In any case, the situation illustrates how the war in the Middle East has redrawn the geopolitics of energy: Washington, which until recently was tightening pressure on Moscow, is now - albeit temporarily - giving Russian oil space on the global market to tame rising fuel prices at home.

gnews.cz - GH