Trump Declares Russia-Ukraine Energy Ceasefire After Diesel Waiver

Updated Oct. 12, 4:55 p.m. ET: Zelenskiy accused Russia on Monday of violating the energy ceasefire, Reuters reported, and said Russia attacked six Ukrainian energy facilities that day, wounding 33 people, according to AFP. Russia did not comment, Reuters said, and would not confirm whether an agreement had been reached, AFP reported. Brent crude settled up $1.93, or 1.8%, at $106.65 a barrel, Reuters said.

President Donald Trump said on Sunday, Oct. 11, that Russia and Ukraine had agreed to an immediate "energy ceasefire," Euronews reported. The announcement came two days after the U.S. Treasury issued a license allowing trade in Russian-origin diesel fuel through April 7, 2027. Russia had not confirmed the ceasefire as of Monday morning, according to Euronews.

What did Trump announce?

"Effective immediately, there is an ENERGY CEASEFIRE in the War between Russia and Ukraine," Trump wrote on Truth Social on Sunday, according to Euronews. He added: "Both parties have agreed. Do not break it!"

Ukrainian President Volodymyr Zelenskiy appeared surprised, said he was seeking details and said Ukraine supports the ceasefire, adding that it is important for Russia to support it too, Euronews reported. Zelenskiy said Russia struck several Ukrainian power plants on Sunday, including in Kyiv and Kharkiv, causing outages, according to Euronews.

What does the Russian diesel license allow?

The Treasury's Office of Foreign Assets Control issued Russia-related General License 135 on Friday, Oct. 9. It authorizes transactions tied to the "sale, delivery, offloading, or importation, including importation into the United States, of diesel fuel of Russian Federation origin" that U.S. Russia sanctions rules would otherwise bar. The license runs through 12:01 a.m. EDT on April 7, 2027. It does not allow any debit to U.S. accounts of Russia's central bank, its National Wealth Fund or its Ministry of Finance.

Trump announced the deal with President Vladimir Putin on Friday to lift sanctions on Russian diesel that were imposed about a year ago, Reuters reported. Russia said on Saturday it had partially lifted its own diesel export ban with immediate effect, according to Reuters. The Canadian Press reported that Russia would supply "millions of tonnes" of diesel to the United States under the deal. No exact volumes, prices or delivery schedule were published.

Why are allies and Kyiv pushing back?

Reuters reported that Trump said on Saturday it was "time for Ukraine to get a new president," and that he said of Zelenskiy's strikes on Russian oil refineries: "He better damn well stop." The Financial Times reported that the U.S. was threatening to halt the program Ukraine uses to buy U.S. weapons to press Kyiv to end deep strikes on Russian energy sites, according to Reuters, which said it could not verify the report.

Canadian Prime Minister Mark Carney told Zelenskiy the diesel deal works against allied efforts to end the war by giving Russia new revenue, The Canadian Press reported. Seven U.S. senators, including four Republicans, said the diesel move was illegal, Euronews reported.

How did fuel markets react?

U.S. ultra-low sulfur diesel futures traded at about $4.71 a gallon at 8:45 a.m. ET Monday, down about 0.5% from Friday's settlement, according to Yahoo Finance data. Brent crude rose about 1.95% to $106.76 a barrel. Trading Economics linked Monday's oil gains to Middle East tensions and also cited the energy ceasefire claim and Russia's planned diesel exports.

The Gulf of Mexico side of the oil story is in Isaias Hits Florida Near Destin; Gulf Oil Shut-Ins Ease to 57.5%. More global coverage is in our world section and energy section.