Trade & Customs Oct 18, 2026 · 8 min read

Trump waives the Graham Act’s Russia tariffs and tanker sanctions

Trump shelves 100% secondary tariffs and Russia tanker sanctions before day one. On Friday 16 October, President Trump waived the Russia sections of the Graham Act. They were due to start today, 18 October. They included tariffs of up to 500% on Russian goods and up to 100% on the top five buyers of Russian energy (ABC News). In our view, Washington has put fuel prices ahead of pressure on Moscow. Diesel averaged $6.31 a gallon on Thursday (Business Today). For forwarders, Chinese and Indian cargo avoids a tariff shock. But the threat can come back at any time. Our call: the waiver holds through year-end. Fuel surcharges will not ease before then.

The Graham Act waiver: Washington trades Russia pressure for cheaper fuel, and leaves the tariff gun loaded
On Friday 16 October, President Trump signed an executive order waiving the Russia sections of the Lindsey O. Graham Sanctioning Russia and Iran Act. He had signed that law in mid-September. Its Russia measures were due to start today, Sunday 18 October.
ABC News lists what the law would have done. It would have put tariffs of up to 500% on Russian goods, including oil and gas. It would have put tariffs of up to 100% on the top five buyers of Russian crude and gas. It would have sanctioned foreign banks doing significant business with Russian state-owned banks. ABC adds that without the waiver, “the law would have required tariffs on Russian petroleum products, such as diesel, and sanctions on ships found to be carrying them.”
According to Gulf News, the order reads: “I am hereby waiving the application of such sanctions, restrictions, and duties provided for in the Graham Act”.
Our view is simple. With diesel near record prices and tanker rates at records, the White House has chosen cheaper fuel and freight over economic pressure on Moscow. For forwarders, that removes a near-term tariff shock on two of the biggest origins into the US. But the threat has not gone away. It can come back with one signature.

What was switched off, and for how long

The waiver covers almost every Russia provision in the law. The biggest for trade was the secondary tariff. A secondary tariff hits a third country for doing business with the sanctioned one. According to Reuters, the law “would have imposed tariffs of up to 100% within 30 days on all goods brought into the US from the five largest importers of Russian crude oil or gas”. It would also have covered any country that knowingly kept buying, or was among the top five helping Russia evade sanctions.
Reuters names China and India as “among the biggest buyers of Russian oil”. Both had pushed back. Reuters reports that Beijing said it “consistently opposed long-arm jurisdiction that lacks a basis in international law”. India warned that new tariffs could affect bilateral ties.
The waiver has no end date. Reuters quotes the order: the waiver stays until Trump or his top officials determine that “further action is appropriate”. ABC notes that the law’s Russia provisions are slated to expire in 2031. That leaves the President five years to switch them back on.
In the order, Trump said he had certified to Congress “that the issuance of such a waiver at this time is in the national interests of the US” (Reuters). The White House framed it as peace diplomacy. “President Trump has been clear that he wants to see this brutal war come to an end,” spokesperson Taylor Rogers said in a statement quoted by ABC. She added: “The President retains the ability to exercise these authorities at any time if he determines that doing so would advance national interests.”

Why we read this as a fuel decision

The official reason is peace talks. The timing points to fuel.
First, this is the second Russia waiver in two weeks, according to ABC. The first came earlier in October. The Treasury’s Office of Foreign Assets Control (OFAC), which runs US sanctions, issued a general license. A general license is a blanket permission that lets everyone do something sanctions would otherwise block. ABC says this one authorizes “the sale, delivery and import of Russian diesel into the U.S.” as part of a deal in which Russia would supply “hundreds of thousands of tons of diesel”. Global Sanctions identifies it as General License 135 and reports that it runs until 7 April 2027.
Second, the price pressure is real. “Diesel prices averaged $6.31 a gallon on Thursday, just below a recent record high of $6.53,” Business Today reported on 16 October. It added that the International Energy Agency (IEA) “has warned of a global diesel shortage lasting until mid-2027.”
Third, the shipping market is under strain. Gulf News reported on 17 October that Iran’s Revolutionary Guard navy said the Strait of Hormuz was closed to vessels of all nationalities. The same live blog logged several attacks on tankers in the Gulf and off Yemen. Reuters, republished by Baird Maritime on 15 October, reported that “Tanker freight rates have soared to record highs as the wars in Iran and Ukraine have stoked inflation”. In the same report, Reuters said Washington is weighing letting “legal oil” move on previously sanctioned “shadow fleet” tankers. These are older ships that have carried Russian, Iranian or Venezuelan oil outside Western rules.
Fourth, the politics. Reuters says analysts warned the Graham measures “could have risked further raising oil prices” weeks before the midterm elections.
Put together, we see a clear pattern. Washington is removing anything that could push fuel or freight costs higher before November.

The backlash, and why it probably won’t bite soon

Congress is angry, including Republicans. Sen. Thom Tillis said, as quoted by ABC: “What part of enforcing a law passed 86-11 by the Senate does the President and his advisors not understand?” Sen. Chuck Schumer, a New York Democrat, said: “Trump just gave Putin the best birthday gift he’ll get this year.” ABC says Sen. John Cornyn urged Trump to rescind the diesel deal and shared an article calling for Congress to investigate. Rep. Don Beyer called it “Trump’s latest surrender to Putin” (Reuters).
Not everyone objected. Rep. Thomas Massie said he was “one of only 7 republicans to vote against” the bill. He welcomed Trump using “the executive authority granted to him by Congress” (ABC). That is the key legal point. The waiver power is written into the law itself. Congress would need new legislation to take it away, and a two-thirds majority to override a veto.
Moscow welcomed the move. Kirill Dmitriev, Putin’s investment envoy, called it “a truly historic moment” (Reuters). Ukraine’s President Volodymyr Zelenskyy said on X, as quoted by ABC: “This certainly does not stop the war.”

What happened last time Washington used a Russia-oil tariff

There is one recent precedent, and forwarders should remember how it worked. On 6 August 2025, Trump issued an order putting an extra 25% duty on Indian goods over its Russian oil purchases. EY reported that this raised “the cumulative additional tariff on Indian goods to 50% ad valorem”. It took effect on 27 August 2025, three weeks later. There was a carve-out for goods “loaded onto a vessel at the port of loading and in transit before the effective date”. EY also listed an entry cut-off of 17 September 2025.
That is the playbook we would expect if the Graham waiver is reversed. There would be a short notice period, a cut-off date tied to loading, and a scramble to get boxes on the water. The Graham Act’s own clock was 30 days.

What forwarders should do now

India and China. US-bound cargo from both avoids a sudden 100% duty for now. Our advice: don’t price it as permanent. Keep tariff-change clauses in quotes and contracts, especially for Q1 2027 contract rates. Keep track of each shipment’s loading date. In 2025, the in-transit carve-out depended on it.
Fuel surcharges. Don’t promise customers relief. Reuters’ maritime sources said easing the shadow-fleet sanctions “is unlikely to result in a broad easing of freight rates as ship insurers will still be bound by EU and UK regulations”. Energy Aspects, a research firm, told clients that lifting the shadow-fleet sanctions was “unlikely to add meaningful mainstream fleet capacity overnight” (Reuters). Business Today reported that the research group Kpler said the move would have “virtually no impact on the current tanker crisis”. Energy Aspects estimates “13-19% of the global tanker fleet is under US sanctions”. But many of those ships are old and in poor condition. Bunker-adjustment factors (BAF, the fuel surcharge carriers add to ocean freight) and trucking fuel surcharges follow fuel prices. Fuel prices are being driven by Hormuz, not by the Graham Act.
Compliance. The US waiver does not change EU or UK sanctions on Russian oil and the ships that carry it. Any shipment touching Russian-origin energy, or a vessel with a shadow-fleet history, still needs screening against those rules. Shippers with European entities or EU/UK-insured cargo remain exposed.

Our prediction

We expect the Graham Act waiver to still be in force on 31 December 2026. We do not expect Congress to pass anything that overrides it this year. We also expect no Graham Act secondary tariff on Chinese or Indian goods before the end of Q1 2027. The exception would be peace talks collapsing in public. The bigger risk for forwarders sits after the midterms. If fuel prices ease and talks stall, this lever is the easiest one for Washington to pull, and the 2025 India case shows it can go from announcement to collection in about three weeks. On costs, we expect bunker and fuel surcharges to stay near current levels through year-end. The shadow-fleet easing and the diesel license will not move them much while Hormuz stays shut.

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