Oil Prices Drop as US Grants 30-Day Waiver for Purchasing Russian Oil

Why Are Oil Prices Falling After the Russia Sanctions Waiver?

Oil dropped on Monday, October 19, 2026. The reason sits in Washington. A US waiver on Russian oil sanctions removed the threat of fresh tariffs on Russia's biggest customers, one day before that threat was due to become real.

The drop was small, though. Brent gave back about 2%, not 10%. That gap tells you something. Traders aren't worried about Russian barrels right now. They're worried about the Gulf.

A Waiver, Not a Repeal

On October 16, President Donald Trump signed an executive order waiving key provisions of the Lindsey O. Graham Sanctioning Russia and Iran Act (SRIA) of 2026. The law had been signed on September 18 and included provisions allowing tariffs of up to 100% on goods from major buyers of Russian oil and gas.

Now they're on hold. But "on hold" is the key phrase. The White House can reverse the waiver whenever it wants. So a refiner in India can buy Russian crude this week, yet it can't sign a six-month contract with full confidence. That doubt is one reason prices didn't fall further.

Brent Gives Back Friday's Spike

Brent crude rose to around $110 per barrel on Friday, October 16, reaching its highest level since May. Prices then retreated as traders assessed the possible impact of the US decision on Russian fuel supplies.

According to Reuters, Brent crude fell 2.08% to $107.57 per barrel, while US West Texas Intermediate (WTI) dropped 1.92% to $99.46 in early trading. Both benchmarks had reached their highest levels in months during the previous session.

Hormuz Is the Real Pressure Point

The Russia sanctions waiver is only one part of the oil market outlook. Shipping disruptions and security risks in the Middle East remain important factors for global supply.

The Strait of Hormuz is a major route for international oil shipments. Any disruption to tanker movements through the strait can delay deliveries, increase transport costs, and make crude supplies harder to secure.

Recent attacks on shipping have added to these concerns. As a result, traders are weighing the potential increase in Russian fuel supplies against the risk of further disruptions elsewhere.

If shipping gets worse this week, oil could climb back above $110, waiver or not.

More Russian Diesel, but Less Than It Sounds

The waiver could help diesel more than crude. Russia agreed earlier this month to supply more than 4.8 million tons of diesel to world markets.

Let's put that into barrels. It works out to roughly 36 million barrels. The US alone uses close to 4 million barrels a day of diesel and similar fuels. So the whole deal covers a little over one week of American demand, spread across several months.

It helps a tight fuel market at the edges. It doesn't fix it. Until tankers move freely through the Gulf again, diesel prices are likely to stay sensitive to every headline

Technical Indicators

These are areas to watch, not promised turning points.

Resistance: $110.00 is the first key level. A sustained move above it could bring $112.00 into focus.

Support: $105.00 is the first area to watch on a further decline. A break below it could expose the $100.00 level.

WTI already slipped under $100.88 on Monday. Getting back above it quickly would show buyers are still in control. Staying below it for several sessions would point to a deeper pullback.

What Should Be Traders' Next Move?

• Monitor Russia policy updates: Watch for any changes to the US sanctions waiver that could affect Russian oil and fuel exports.
• Follow Middle East News: Tanker attacks move oil faster than sanctions headlines.
• Watch Brent near $105 and $110: A break of either level may set this week's direction.
• Track WTI around $100: A sustained move above or below this level could provide clues about short-term market sentiment.
• Manage risk carefully: Oil can gap 2% to 3% overnight on one headline. Consider position sizing, stop-loss placement, and the risk of price gaps before entering a trade.