A tanker of Russian diesel is at sea and bound for New York, the Kremlin said Friday. It's the first cargo under President Trump's import deal. Kpler, a ship-tracking firm, says it should arrive Nov. 7. That's four days after the midterm election on Nov. 3.
It would be the first Russian diesel delivered to the U.S. since July 2023. Trump announced the deal with Vladimir Putin two weeks ago, even as Moscow's war in Ukraine goes on. The White House rolled back sanctions to make it possible. It was widely read as a bid to cool fuel prices before the vote. Energy policy experts quoted by the Associated Press doubt the deal will do much for high prices, at the pump or anywhere else. Ukraine's president, Volodymyr Zelensky, called it “a weak decision by strong partners.”
Here's the scale. One tanker is one tanker. Diesel futures in New York Harbor settled Friday at $4.9842 a gallon for November. They rose 1.74% on the week. The market shrugged. Crude did the opposite of what a diesel deal needs. WTI crude for December settled at $103.27 Friday, up $3.80. The Journal's market report tied Friday's oil jump to bets on renewed fighting in Iran. A tanker of Russian diesel doesn't change that.
What this means for Valero
We've followed this thread since the deal was announced. Valero (VLO), the big refiner, is held at 3.0% in ten books and at weight in 12 books overall. Nothing added. Our written trim trigger is a White House limit on diesel exports. That would hurt a refiner that sells fuel abroad. This cargo is an import, not an export limit. It adds a little supply, and it leaves Valero free to keep selling overseas. The trigger isn't met. Valero closed Friday at $419.28, down $7.00 on the day. It's up 157.56% this year.
Our read
This is Investments and Risk (IN04). A policy headline and a price are two different things. The headline says cheaper diesel. The price says one tanker in a very big ocean. The experts expect little change where you fill up. We'd rather own the refiner at the size we set than trade a story. Valero stays held at weight. The written trigger is the export limit, and it hasn't happened.
One thing in your plan. Your winter fuel line, heating oil for the house or diesel for the truck. One check this week. Price your next fill at today's number instead of the hoped-for one, and see if the month still clears. Fuel is a bill you can't skip. You don't put the umbrella away because one cloud moved. We're happy to look at the fuel line with you.