The effectiveness of Russian diesel oil supply is questionable; store prices rise from last week

[New York Current Affairs] In order to deal with the soaring price of diesel oil, the effectiveness of the US Trump administration's partial relaxation of sanctions on Russia and the market supply of Russian diesel oil are being questioned. The ``energy cease-fire'' between Russia and Ukraine that Trump claimed to have agreed to is in disarray, and diesel prices are currently rising. Some U.S. financial institutions have pointed out that such measures "cannot solve the fundamental problem," and there is no sign that U.S. diesel oil prices, which remain more than 70% higher than last year, will decline.

U.S. President Trump says sanctions tariffs on Russia will not be applied, takes a conciliatory stance, senses crisis over soaring diesel oil price

Trump spoke by phone with Russian President Vladimir Putin on the 9th, and announced that Russia had agreed to supply more than 300,000 tons of diesel oil to the United States and international markets. On the same day, the U.S. Treasury also announced that sanctions against Russia will be partially eased until early April 2027, allowing the sale and export of Russian-produced diesel oil to the United States and other countries.

Meanwhile, according to a summary by the American Automobile Association (AAA), the national average retail price of diesel oil was about $6.33 (about 1,000 yen) per gallon (about 3.8 liters) as of the 16th, up from $6.28 (about 992 yen) on the 9th of last week. Although there is a time lag before price fluctuations in the petroleum products market are reflected in store prices, the effects are not visible at this time.

Trump also explained on the 9th that Russia will supply more diesel oil to the market after November.

Meanwhile, Bank of America, a major U.S. financial institution, pointed out in a report on the 13th, ``There is no 'silver bullet' (silver bullet) for the diesel oil issue.'' The analysis shows that the rise in crude oil prices due to the US-Iran conflict, the decline in Russia's oil refining capacity due to the attack on Ukraine, and strong demand from Organization for Economic Co-operation and Development (OECD) countries are contributing to the soaring prices of diesel oil. He emphasizes that issues such as insufficient inventories and refining capacity cannot be resolved by easing sanctions or releasing stockpiles.