Rod Alzmann

Have you all seen Trump’s announcement of his SUPER PUTIN DEAL? Russia promises to immediately supply more than 300,000 tonnes of diesel to the market, including the US, followed by another 500,000 tonnes in November. Then come promises of EVEN BIGGER volumes. Because the deal has to be HUGE. At least in the post. OFAC, of course, wasted no time issuing a temporary waiver until April 7 to accommodate the president’s latest “GENIUS” deal. Except the BIG DEAL is not actually that big. More of a stage prop. Very Trump. Let’s do the maths. Actual numbers. TERRIBLE, I know. 300,000 tonnes is roughly 2.2 million barrels of diesel. 500,000 tonnes is roughly 3.7 million barrels. In September, Russia managed to export just 0.1 million barrels. Basically none, as there is export ban. So Putin has already “sold” Trump a volume 22 TIMES larger than Russia’s entire September exports. Making promises is, of course, easier than rebuilding refineries after Ukrainian strikes. MUCH EASIER. SOME SAY THE EASIEST. Meanwhile, Russia’s diesel export ban remains in force until October 31: the fuel is needed domestically, and Ukrainian drones have significantly reduced Russia’s ability to produce it. A VERY SUCCESSFUL phone call with Trump is unlikely to have fixed those problems. Now for another comparison. Russia’s average monthly diesel exports last year were 18.3 million barrels. The promised deliveries amount to just 12% and 20% of that volume, respectively. So we have a promise that Russia still needs to find a way to fulfil, given the state of its refineries. And even if delivered, it looks considerably less impressive than the presidential CAPS LOCK. Not quite THE GREATEST DEAL IN HISTORY. The political logic is clear. The war with Iran and high fuel prices are a bad backdrop for the elections. One would hope politically FATAL, at this point. The administration desperately needs a story about how the president is about to FIX EVERYTHING. Preferably IMMEDIATELY. Preferably without explaining how we got here in the first place. So perhaps the main product of this deal is not even diesel. It is another attempt to calm the market with a BIG, BEAUTIFUL ANNOUNCEMENT. Let’s see how much credibility these announcements still have. Russia, of course, will sell this as a HUGE VICTORY. And why wouldn’t it? Promise diesel you still need to find somewhere, get a sanctions waiver UPFRONT. Plus another opportunity to tell the world that it simply CANNOT MANAGE WITHOUT RUSSIA. But what worries me most is that this spectacle could weaken our European partners’ resolve. Trump’s latest “breakthrough” must not become an excuse to ease sanctions pressure on Russia — precisely when that pressure needs to INCREASE. Of course, this decision will benefit Russia by generating additional revenues. We’ll be watching how much of its export capacity Russia actually manages to restore. One thing is CLEAR: Ukrainian strikes on Russian refineries need to INTENSIFY.