Trade & Customs Oct 17, 2026 · 8 min read

Trump pauses Russia tariffs and eyes shadow-fleet tankers to cut diesel

Russia tariff threat paused, but diesel relief stays thin. On Friday President Trump waived the Graham Act’s Russia measures, including tariffs of up to 100% on the top five buyers of Russian oil and gas, two days before they were due to start (ABC News). Our view: this pauses a big tariff risk on India and China lanes. It does not remove it. The waiver lasts only until the White House decides otherwise. A plan to free sanctioned tankers will barely touch diesel either. Kpler expects “virtually no impact on the current tanker crisis” (Reuters). Our call: US diesel stays above $6 a gallon through the 3 November midterms.

Two diesel moves before the midterms: one pauses a tariff threat, the other will not shift freight costs On Friday 16 October President Trump signed an order waiving most of the Russia measures in the Lindsey O. Graham Sanctioning Russia and Iran Act. He had signed the law last month. Its Russia measures were set to take effect on 18 October (ABC News). The Senate had passed it 86-11 (The National News Desk).
The waived measures were large. They included tariffs of up to 500% on Russian goods. They included tariffs of up to 100% on the top five buyers of Russian crude oil and natural gas. They also covered the top five countries helping Russia evade oil sanctions, foreign banks dealing with Russian state banks, and bans on Russian sovereign debt (ABC News).
On the same day, reports said Washington was weighing a second step. Blacklisted “shadow fleet” tankers could be sold to legitimate operators and return to normal trade (Business Today, citing the Financial Times). Both moves share a goal: cheaper diesel before the 3 November midterm elections.
Our view: the waiver matters more to forwarders than the tanker plan. It takes a 100% tariff threat off goods from big Russian-energy buyers such as India and China. But it can be reversed at any time, so contracts should still plan for it. The tanker plan, on the evidence so far, will do very little for freight or fuel costs. Diesel will stay expensive, and road and inland surcharges will follow it with a lag.

What the waiver does, and what it does not

The waiver is temporary by design. It stays in place until the president or the secretary of state decides more action is needed. The law’s Russia provisions run until 2031 (ABC News). So the tariff tools stay on the shelf for five more years, ready for use.
The order also does not touch sanctions already imposed by earlier executive orders (ABC News). Existing Russia screening duties for forwarders do not change.
Fox Business reports that Trump told Congress the waiver was in the “national interests of the United States.” The White House framed it around peace talks. Spokesperson Taylor Rogers said: “President Trump has been clear that he wants to see this brutal war come to an end.” She added that enforcing the sanctions now “would impede ongoing U.S. efforts” to reach a deal (ABC News).
Reaction split across and within parties. Rep. Thomas Massie, a Republican, backed it: “Glad to see Trump has used the executive authority granted to him by Congress” to waive most of the law (ABC News). Senate Democratic leader Chuck Schumer said: “Trump just gave Putin the best birthday gift he’ll get this year.” Republican Sen. Thom Tillis called it “Beyond irresponsible.” He asked: “What part of enforcing a law passed 86-11 by the Senate does the President and his advisors not understand?” (ABC News). Ukraine’s President Volodymyr Zelenskyy said: “And it definitely helps only the Russians” (ABC News).

Why India and China lanes just got less risky

A tariff of up to 100% on goods from the top buyers of Russian energy could have come close to doubling the cost of many imports. India.com says India “was among the countries facing the risk of higher tariffs because it remains a major buyer of Russian crude oil.” It adds: “China was also potentially exposed to the proposed measures.”
For US importers, that risk was days away. Now it is paused. Our reading is that shippers who held back orders from India, or priced in a tariff shock, can relax a little. But only a little. A waiver issued by one signature can be pulled by another. And with an election just over two weeks away, the politics could change fast in either direction.

The diesel deal that came first

This is the second time in as many weeks that Trump has waived Russia sanctions (ABC News). The first move came on 9 October. The Associated Press reported that Trump struck a deal with Russia to supply diesel. Russia would “immediately supply more than 300,000 tons of diesel,” then 500,000 tons in November, then 1 million tons, then 3 million tons. That adds up to at least 4.8 million tons. The Treasury’s sanctions office, OFAC (Office of Foreign Assets Control), has since issued a general license (a blanket permission) allowing Russian diesel sales and imports into the US through April (ABC News).
Trump said at the time: “Lower prices for Americans, especially our Great Farmers, Ranchers, and Truckers, is my Greatest Priority” (AP via WUNC). Democratic Rep. Don Beyer said: “Trump isn’t the slightest bit trustworthy when it comes to Russia.” Zelenskyy called it “a weak decision, unfortunately, a weak decision by strong partners” (AP via WUNC).
Supply is the catch. Russia has banned diesel exports since July, partly because of Ukrainian attacks on its refineries. The International Energy Agency says Russian diesel output has fallen by about 30% (AP via WUNC). The IEA has also warned of a global diesel shortage lasting until mid-2027 (Business Today). A deal to buy more Russian diesel does not create diesel Russia is not making.

The tanker plan, and why analysts doubt it

The second idea targets shipping costs. Energy Secretary Chris Wright, speaking at the World Petroleum Conference in Riyadh, said a shortage of tankers had become a key bottleneck driving up freight rates (Business Today). A Treasury official said OFAC may authorise such transactions and remove sanctions case by case (Business Today). An unnamed US official told Reuters: “This would lower shipping rates and increase flows” (Baird Maritime).
Analysts are not convinced. Kpler, a ship-tracking firm, counts about 160 supertankers under US sanctions, about 22% of the commercial fleet. About 46 of them are more than 20 years old. Once age and Iranian state-owned ships are excluded, only about 24 could rejoin global trade. Kpler “expects the measure to have virtually no impact on the current tanker crisis” (Reuters via Baird Maritime). Energy Aspects, a consultancy, puts the sanctioned share at 13–19% of the global tanker fleet. It says age and condition would limit any gain (Business Today).
The practical barriers are big. David Tannenbaum of Blackstone Compliance Services said: “Companies are unlikely to charter tankers that were recently under sanctions.” He noted that “EU sanctions still exist” for tankers in Russian trade. Reuters adds that licences to repossess or sell such a tanker typically take months, possibly years. Many shadow-fleet ships also lack class certificates, the inspection papers insurers usually need (Reuters via Baird Maritime).
The market still blinked. Forward freight agreements (contracts that lock in future shipping rates) fell on the report. Aframax rates (a mid-sized tanker class) from the US Gulf Coast to Europe fell 30 points, said Scott Shelton of TP ICAP. The discount of US WTI crude to Brent narrowed to about $10.42 a barrel, from $14.17 earlier in the week (Reuters via Baird Maritime). The cause of high tanker rates has not changed: attacks, higher war-risk insurance and hard operations moving oil out of the Strait of Hormuz (Reuters via Baird Maritime).

What it means for forwarders

Diesel is the cost that touches every forwarder. US diesel averaged $6.31 a gallon on Thursday, just below a recent record of $6.53 (Business Today). The EIA (the US Energy Information Administration) put the weekly average at $6.529 in the week of 21 September, an all-time high (Tradlinx). It was $6.20 on 5 October (Supply Chain Dive, citing the EIA).
Surcharges follow diesel, but late. Supply Chain Dive, citing American Trucking Associations chief economist Bob Costello, notes that trucking fuel surcharges (FSC) “commonly adjust on a weekly schedule tied to the EIA’s diesel price.” Ocean carriers’ inland surcharges lag more. Seaboard Marine’s inland fuel surcharge rose to 57.50% from 11 October, based on early-September prices of about $5.78. Tradlinx estimates the September peak will feed a later reset around 25 October. Hapag-Lloyd’s emergency inland fuel charge rose on 1 October to USD 64 for truck moves (Tradlinx). Earlier this year, Magnus Technologies estimated that a 55-truck fleet on monthly resets would miss about $168,000 in fuel costs (CCJ).
So in our view: - Expect US inland and drayage fuel charges on late-October and November invoices to reflect the September peak, whatever Washington does now. - Keep tariff-change and sanctions clauses in contracts on India and China lanes. The waiver can be withdrawn without new law. - Do not change sanctions screening for tankers or cargo tied to recently designated ships. EU sanctions still apply, and US relief, if it comes, will be ship by ship. - Tanker relief is unlikely to lower bunker-linked surcharges such as BAF (bunker adjustment factor) on ocean freight soon.

Our call

We expect the EIA weekly US diesel average to stay above $6 a gallon through the 3 November midterms. We expect no more than a handful of sanctioned tankers to be cleared for legal trade by end of Q4, too few to move tanker rates. And we expect the Graham Act tariffs to stay waived through at least the end of Q4. The bigger tariff risk for India and China lanes returns only if peace talks collapse.

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