Trump’s declaration of an “energy ceasefire<\/a>” between Russia and Ukraine on Sunday surprised policymakers across the world \u2014 not least in Kyiv \u2014 and prompted oil prices<\/a> to fall on Monday, despite Russia striking a power plant shortly after the announcement. Oil later rose.<\/p>\n The president’s declaration comes after he announced a deal for Russia<\/a> to release 300,000 metric tons to the U.S. and global markets immediately, followed by another 500,000 tons in November and 1 million tons after that. Moscow will then deliver another 3 million tons of diesel based on the condition of Russia’s refineries, Trump said.<\/p>\n Trump has sought to tame inflation ahead of the congressional midterms in November, when his Republican Party is at risk of losing both houses.<\/p>\n According to the Pew Research Center<\/a>, 84% of registered voters say the economy is “very important” to their vote.<\/p>\n Stock Chart IconStock chart icon Oil prices dipped Monday on improved supply hopes <\/p>\n Diesel prices hit a record high average of $6.5276 a gallon in late September, according to AAA<\/a>, as the wars in Ukraine and the Middle East took their toll on supply.<\/p>\n “Trump is exploring all avenues to bring down diesel prices before the mid-terms,” Mohit Kumar, chief European economist\u00a0at Jefferies, said in a note on Monday.<\/p>\n “The deal with Russia has drawn opposition both from within the US and from European leaders, as it would be bypassing the Russian sanctions in place,” he added. <\/p>\n “While more supply of diesel would … ease some pressure on diesel prices, the volumes agreed are unlikely to make a substantial difference.” <\/p>\n Russia’s ‘mystery’ diesel supply<\/p>\n The U.S. Treasury has issued a temporary license easing sanctions on Russian diesel to facilitate the deal Trump announced Friday.<\/p>\n Lombard Odier analysts said in a Monday note that the agreement, in addition to Chinese plans to resume refined-fuel exports, are “potentially significant because diesel shortages have amplified the inflationary consequences of disrupted energy supply, particularly through transportation, agriculture and industrial production.”<\/p>\n But they cautioned that “announced shipments are not equivalent to delivered supply,” and “neither agreement immediately restores damaged infrastructure or normalizes maritime transportation.”<\/p>\n Neil Atkinson, former head of the Oil Division at the International Energy Agency, was less optimistic, telling CNBC in a note: “Where the volumes to supply the Trump deal come from is a mystery, unless it comes from domestic supply, which will cripple the Russian economy.”<\/p>\n![\"hide](\"https:\/\/static-redesign.cnbcfm.com\/dist\/a54b41835a8b60db28c2.svg\")
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