The Trump administration is considering lifting sanctions on the Russian Direct Investment Fund (RDIF), on which the former Biden administration imposed sanctions in the early days of Russia’s full-scale invasion of Ukraine in February 2022.
Russian officials pushed for the move during discussions on RDIF’s role in Russian diesel exports to the US, The New York Times reported on Tuesday, Oct. 27, citing people familiar with the matter. An unnamed US official confirmed to the newspaper that the US Treasury Department was reviewing the fund’s application for delisting through its standard procedures.
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“While officially a sovereign wealth fund, RDIF is widely considered a slush fund for President Vladimir Putin and is emblematic of Russia’s broader kleptocracy,” the Treasury said under the former Biden administration.
By contrast, the US official told NYT that the current review was a part of an effort to improve bilateral relations between Moscow and Washington, with the fund’s chief executive, Kirill Dmitriev, praised as a “helpful envoy” in ending the war.
RDIF was initially created in 2011, by the order of former Russian President Dmitry Medvedev and then-Prime Minister, current Russian President Vladimir Putin.
Diesel deal paves way for sanctions relief
The request is linked to the diesel arrangement that Trump abruptly struck with Putin on Oct. 9, at the same time the Ukrainian delegation was in Miami, hoping to reach a breakthrough in Russia’s war.
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Shortly after the deal’s announcement, the US Treasury Department authorized the sale and import of Russian diesel fuel through April 7, 2027.
The move came only three weeks after Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act into law on Sept. 18, appearing to completely disregard the bill intended to target Russia’s energy and defense industries, as well as networks close to Putin.
According to NYT, RDIF offered to handle transactions between Russian sellers and American buyers, while at the same time pushing for its removal from the sanctions list. To be delisted, RDIF would have to prove that the reasons for its original designation no longer apply.
Russian officials said three diesel tankers have sailed for the US this month, while Russian Deputy Prime Minister Alexander Novak said on Oct. 23 that RDIF had provided significant support for the shipments.
Some of the fuel left Russia before any US buyer had paid for it, people familiar with the matter told NYT.
Ship-tracking firms Kpler and TankerTrackers.com showed that one tanker, the Agioi Fanendes, departed the port of Primorsk on Oct. 23 and is expected in the US on Nov. 7.
It has since changed its listed destination from New York to “for orders,” meaning it has no discharge instructions yet.
From slush fund to trusted mediator
Eric Green, who oversaw Russia policy at the National Security Council under former President Joe Biden, told the NYT that lifting the sanctions would signal that Washington was abandoning its earlier position of keeping economic pressure on Moscow until a peace settlement was reached in Ukraine.
Meanwhile, Dmitriev has become Moscow’s main economic channel to Trump’s team, working directly with senior US envoys Steve Witkoff and Trump’s son-in-law, Jared Kushner.
On Oct. 21, Witkoff publicly confirmed that Washington and Moscow are discussing future economic and trade cooperation, alongside negotiations to end the war.
He also revealed that the US Treasury Department is working directly with Dmitriev.
On that same day, Moscow revealed that Russia and the US are discussing the future of sanctioned Russian oil giant Lukoil’s overseas assets, valued at approximately $22 billion.
The US also proposed restoring Russian gas supplies to Europe, including reviving the Nord Stream pipeline system, The Economist reported on Oct. 22.
Earlier on Tuesday, Le Monde reported that the Kremlin is courting Trump and his inner circle with economic deals, including those in energy, civil aviation, rare earth metals and artificial intelligence (AI), without first agreeing to a ceasefire.
According to the same report, Witkoff presented Ukrainian negotiators in Florida on Oct. 9 with a postwar “regional prosperity plan,” which envisaged fully restoring Russian oil and gas supplies to Europe through Ukrainian territory.
Weeks of escalation triggered by diesel arrangement
The diesel agreement triggered weeks of severe diplomatic tensions between Kyiv and Washington.
Around the same time, Trump claimed it was time for Ukraine to get a new president, while, days later, restrictions on Starshield, the military version of the Starlink satellite network, disrupted Ukrainian drone operations.
Elon Musk claimed such limits were ultimately decided by Trump, not his company; a claim the US president denied.
On Oct. 14, in an interview with British broadcaster Piers Morgan, President Volodymyr Zelensky described Trump’s diesel deal as a victory for Putin, warning that Moscow was exploiting Washington’s decisions to pressure Ukraine into concessions.
Around the time, Zelensky also suggested that Russia was offering Washington potential business ventures and economic projects to influence its decisions.