Trump announces surprise diesel deal with Putin: How much will Russia ship and would it be enough to bring down prices?

President Donald Trump on Friday (Oct. 9) announced a deal to import Russian diesel into the United States, amid surging pressure to reduce fuel prices. In a post on Truth Social, Trump said that Russian president Vladimir Putin had agreed to release 300,000 tons of diesel immediately "to the American and global marketplace." That would be followed by 500,000 tons in November and another million after some time, Trump added.

How much diesel will Russia ship?

As part of the surprise deal, the US Treasury is suspending sanctions on Russian diesel exports until April 7. In his post, Trump said that a separate three million tons of Russian diesel would be shipped to the US "within a short period", depending on the condition of its refineries, which have suffered attacks by Ukraine amid the war. This takes the total expected shipment of Russian diesel to 4.8 million tons.

Putin speaks on the deal

Putin said that Russia was willing to supply both the US and world markets with oil and petroleum products, but did not specify amounts. "The Russian side confirmed its willingness to supply oil and petroleum products to the US market and global markets at large," he said.

Russia had imposed a ban on diesel exports earlier this year. According to the International Energy Agency (IEA), the country's diesel production is estimated to have plunged by about 30 percent.

What is the current diesel price?

Trump's announcement marks his latest attempt to bring down fuel prices, which have skyrocketed in the aftermath of the war in Iran, that began in February. The president is under pressure over pump prices and overall inflation as the midterm election is just weeks away.

The average diesel price in the US is currently $6.28 per gallon, according to the American Automobile Association. It had touched a record high of $6.53 at the end of last month.

How much diesel does US consume?

The extent to which the freshly-announced deal will ease the soaring prices remains unclear. Analysts have said the amounts mentioned by Trump are not proportional to the diesel consumption in the US.

The first tranche of Russian diesel equated to roughly 2.25m barrels, while daily national consumption was around 3.8m barrels. "So it won't make a material difference to pump prices in the US," Tim Armitage, an investment strategist at Quilter Cheviot, told the BBC.

Last year, total diesel consumption for all uses in the US was roughly 1.42 billion barrels, according to data from the US Energy Information Administration.

Zelenskyy calls it 'gift to Putin'

Ukrainian President Volodymyr Zelenskyy has hit out at the deal, saying "gifts to Putin will not work for peace." He added: "We count on America's fair support for our defence of life, for our defence of people in Ukraine – and on the United States having a correspondingly strong conversation with Russia."

Several US lawmakers, including Trump's fellow Republicans, have also criticised his diesel deal.