Donald Trump: Expert doubts that fuel prices will fall due to the diesel deal

According to IW economist Samina Sultan, the diesel agreement between US President Donald Trump and Kremlin chief Vladimir Putin will not lead to lower prices at gas stations in the USA or in Germany.

The amount of more than 300,000 tons of diesel that Putin immediately promised was not enough to make a big difference, Sultan told the German Press Agency. “The world market price will not change significantly,” explains the expert from the Institute of German Economics (IW) in Cologne.

According to the US Energy Administration (EIA), consumption of diesel and other distillate fuels in the US currently averages around 3.77 million barrels per day. This corresponds to the equivalent of around 500,000 tonnes. The delivery of 300,000 tons would theoretically only cover US consumption for around 14 hours.

Fuel prices put Trump under pressure

After a conversation with Kremlin chief Vladimir Putin, US President Trump announced an agreement to supply diesel from Russia. To make this possible, the USA wants to temporarily lift sanctions against Russian diesel.

Given the rise in fuel prices in the USA, Trump is under great pressure ahead of the important midterm elections, which take place in less than a month. In view of this, Sultan speaks of a more “symbolic act”.

In the case of further deliveries, it is also questionable to what extent Russia can deliver at all. In recent months, Ukraine has increased its attacks on oil industry facilities in Russia. The consequences are clearly noticeable there.