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The United States has announced it will allow India to temporarily purchase Russian oil amid the ongoing war with Iran, which has disrupted global energy supplies and driven up oil prices.

Some shit you should know before you dig in: Last year, President Trump put significant pressure on India to stop purchasing Russian oil as part of the United States’ broader effort to cut off funding for Russia’s war in Ukraine. The administration imposed steep tariffs on Indian imports and threatened additional penalties if the country continued buying discounted Russian crude, which had become attractive to India because Western sanctions forced Moscow to sell at lower prices. Facing mounting economic pressure, the Indian government eventually agreed to scale back those purchases to ease trade tensions with the United States. To replace the lost supply, India increased its reliance on oil from Middle Eastern producers, much of which must travel through the Strait of Hormuz (a narrow shipping route near Iran that has now become a major chokepoint amid escalating regional tensions).

What’s going on now: In a notable development, Treasury Secretary Scott Bessent announced that the US Treasury would grant India a temporary 30 day waiver allowing its refiners to purchase Russian crude that is already loaded on tankers and currently stranded at sea. The waiver specifically applies only to oil that had already been shipped before the decision and does not broadly lift sanctions on new Russian exports. US officials described the move as a short termmeasure meant to prevent a sudden shortage of crude in global markets while maintaining the broader sanctions regime targeting Russia.

The decision comes as the war involving Iran has effectively choked off normal energy flows through the Strait of Hormuz, one of the most important oil shipping routes in the world. The escalating conflict has made many tanker operators unwilling to pass through the area, with some vessels turning around or remaining idle while waiting for conditions to stabilize. The conflict has also led insurers to cancel coverage entirely for some voyages, while in other cases insurance premiums have reportedly increased as much as tenfold, making many shipments financially unviable.

It should be noted that this crisis has created an unexpected financial boost for Russia. As Middle Eastern supplies become harder to access, demand for Russian crude has risen sharply, allowing Moscow to sell its oil at significantly higher prices than in recent months when sanctions forced steep discounts.