The U.S. Treasury Department has temporarily lifted sanctions on Russian oil already at sea in a bid to slow climbing energy prices fueled by the war in Iran, Carnegie analysts have reported in Foreign Affairs, "Hvylya" reports.
The 30-day license specifically enables the sale of previously sanctioned Russian crude to India. The move, announced last Thursday, marks a sharp reversal of Washington's strategy of squeezing Russian oil revenues to weaken Moscow's war effort in Ukraine.
The analysts - Alexander Gabuev, Nicole Grajewski, and Sergey Vakulenko - explain that the closure of the Strait of Hormuz has created a shortage that is driving up global oil prices. The Gulf is also a major supplier of liquefied natural gas, and dramatically reduced exports from the region have further tightened energy markets.
Through 2025, the picture looked very different. An OPEC+ decision to boost production had created a surplus, giving buyers alternatives to Russian oil. That surplus, "coupled with increasing sanctions pressure from the United States, drove steep discounts on Russian oil," the analysts write. The Iran war has wiped out those gains.
For Russia, the windfall is substantial - each sustained price spike translates into hundreds of millions in additional daily revenue. The analysts note that European and U.S. policymakers now face a difficult choice - continue tightening sanctions on Russia "at a mounting economic cost" or soften their stance to stabilize energy markets.
The Treasury's decision to ease pressure on Russian crude is the first concrete signal that Washington may be choosing the latter path, at least temporarily.
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