US makes u-turn on Russian oil waivers, extends limited transit exemption till May 16

The United States has made a policy u-turn on its sanctions approach by extending a limited waiver that allows Russian oil shipments already in transit to reach global markets, despite earlier indications that the exemption would not be renewed.

The Department of the Treasury issued the order late Friday, extending the sanctions waiver on Russian oil until May 16. The exemption applies strictly to crude and petroleum products already loaded on vessels on or before April 17 , permitting only the completion of existing shipments and not any new trade.

The decision effectively reverses remarks by US officials, including Treasury Secretary Scott Bessent , who had said the waiver would not be continued. The latest order replaces General License No. 134A with General License No. 134B , maintaining a narrow transit-only allowance .

The move is widely seen as a measure to stabilise global energy markets amid volatility and supply uncertainty, with reports suggesting the waiver covers around 100–140 million barrels of Russian oil already at sea .

The development comes at a time of heightened pressure on global crude supplies due to geopolitical tensions and shifting trade flows, prompting concerns over price spikes if shipments in transit were abruptly halted.

The decision also carries significance for India , which has emerged as one of the largest buyers of discounted Russian crude. While the waiver does not affect new purchases, it ensures that cargoes already contracted and en route to Indian refiners are delivered without disruption. This provides short-term continuity for India’s import planning and refinery operations, which have increasingly relied on Russian oil to manage energy costs. However, uncertainty remains over future shipments, as the waiver does not extend to fresh trade beyond the limited transit window.

Officials reiterated that the licence excludes transactions involving Iran, North Korea, Cuba and restricted regions of Ukraine , keeping broader sanctions intact.