US Treasury eases purchase of Russian oil in move to stabilise markets

The US Treasury Department issued a temporary 30-day general licence allowing the most energy-vulnerable nations to access Russian oil stranded at sea, aiming to stabilise global crude markets and redirect supply to "countries in need".

Treasury Secretary Scott Bessent announced the move in a statement overnight on Tuesday (May 19), saying the extension provides flexibility for specific licenses as needed.

The action is intended to help reroute existing supply away from China, which has been stockpiling discounted Russian oil, while ensuring oil reaches nations facing energy shortages.

"This general license will help stabilise the physical crude market and ensure oil reaches the most energy-vulnerable countries," Bessent said. "It will also help reroute existing supply to countries most in need by reducing China’s ability to stockpile discounted oil," Bessent stated in a post.

The announcement comes amid ongoing international sanctions on Russian energy exports tied to Moscow's war in Ukraine.

Russia has faced restrictions on selling its oil, leading to stranded tankers and disruptions in global supply chains.

The US under the current administration has maintained a mix of sanctions pressure alongside pragmatic measures to manage energy markets and inflation concerns at home.

Scott Bessent, a longtime hedge fund executive and the 79th Treasury Secretary, was confirmed in January 2025.

He serves in President Donald Trump's second administration, where economic priorities include managing high national debt, energy prices, and global commodity flows.

The move has drawn criticism from some Ukraine supporters, who argue it indirectly benefits Russia's war economy.

Others view it as a practical step to prevent oil price spikes and address humanitarian energy needs in developing nations.

Russia’s state-linked entities and buyers, particularly in Asia, have adapted to sanctions through shadow fleets and discounted sales.