Russia Sanctions Waiver Leaves Latin American Buyers Exposed

UNITED STATES · ANALYSIS

The russia sanctions waiver signed by President Donald Trump on 16 October 2026 suspends, but does not eliminate, 500% duties on Russian goods and 100% tariffs on major buyers of Russian energy. For US firms and Latin American importers, the decision creates a period of commercial relief that could end with a single executive determination.

Brazil is a major agricultural economy and a major importer of fertiliser, including Russian fertiliser, while Mexico, Argentina, Chile, Colombia and Peru have varying exposure to Russian petroleum products. This analysis explains what the waiver means for those trade relationships and for American companies, drawing on the USA & Canada Intelligence Brief published on 17 October 2026.

What the Order Says and Why It Was Waived

The executive order implements the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, which President Trump signed on 18 September 2026. The law authorizes a duty of up to 500% ad valorem on goods from Russia; the order describes the duty as applying to Russian goods subject to statutory exceptions and waivers, rather than specifically stating that all Russian energy products are included.

It also permits a 100% additional duty on goods from the five largest purchasers of Russian crude oil or natural gas, and a further 100% duty on goods from the five largest facilitators of Russian oil-sanctions evasion. The October 16 order activates these measures but immediately suspends their application.

The suspension remains in force until the President or the Secretary of State, in consultation with other administration officials, determines that the measures should be applied.

The immediate reason for the waiver appears to be economic and political rather than a change in Washington’s position on Russia.

The waiver avoids making those purchases commercially impossible through a 500% tariff.

Latin American Exposure to Russian Diesel and Fertiliser

Latin America is not identified in the available reporting as part of the act’s initial five largest Russian-energy buyers. The exact designation depends on the statutory methodology and subsequent US determinations.

That does not make Latin American countries immune. The law targets qualifying Russian energy purchases and gives the administration monitoring authority over countries that buy Russian-origin crude or gas or help evade sanctions.

The most exposed Latin American market is Brazil, a major agricultural economy and a major importer of fertiliser, including Russian fertiliser.

A key analytical distinction is necessary: Russian fertiliser is not identical to Russian crude oil or natural gas under the reported wording of the secondary-tariff provisions.

The act’s reported 100% measure is aimed principally at countries purchasing Russian crude oil or gas.

The Brazil Trade Angle

Brazil is especially important because its Russian relationship is concentrated in fertilisers, not merely energy.

Disruptions would affect Brazilian farmers, input distributors, crop margins and ultimately food prices. For Brazil, the immediate impact of the waiver is therefore an improvement in supply certainty.

Brazilian importers can continue negotiating Russian fertiliser cargoes without an immediate US secondary tariff. Banks, insurers and shipping companies receive temporary relief from the risk that a Brazilian customer could suddenly become subject to punitive US measures.

Brazilian farmers could face higher fertiliser costs because Brazil imports substantial volumes of fertiliser, including from Russia. Brazil retains flexibility to buy Russian energy or fertiliser while maintaining its broader foreign-policy position of strategic autonomy.

The commercial benefit is conditional. A US tariff on Brazilian exports would not be imposed simply because Brazil imports Russian fertiliser unless Brazil falls within the act’s covered categories or Washington applies a broader interpretation. The principal current threat is therefore uncertainty, not an already applicable Brazilian penalty.

What the Waiver Means for US Firms

For US companies, the waiver is a short-term commercial relief measure with a long-term compliance cost. Energy companies and fuel buyers benefit because Russian diesel can enter US supply chains without the threatened 500% duty.

However, they still face reputational, sanctions-screening and payment risks, particularly if the transaction involves entities covered by earlier Russia sanctions. Importers and manufacturers avoid an immediate price shock.

A tariff of up to 500% on Russian goods, including Russian energy products, could have affected Russian-origin imports into the United States, while a 100% tariff on goods from major Russian-energy buyers could have raised costs across unrelated supply chains. Banks, insurers and logistics companies must continue monitoring counterparties and cargo origins.

The waiver does not erase earlier sanctions, and the order directs US agencies to monitor Russian-energy purchases and sanctions evasion. US exporters remain exposed to retaliation if the administration later activates the duties.

The prospect of retaliation is itself a reason for companies to avoid treating the waiver as permanent.

If the Waiver Ends

If President Trump or the Secretary of State terminates the waiver, the consequences would likely include higher landed costs. A 500% US duty on Russian goods would have sharply increased the cost of direct Russian imports.

A 100% duty on goods from covered buyer countries would similarly penalise exports from those countries, not only the Russian-energy transaction itself. Trade diversion and supply disruption would follow.

Russian diesel and fertiliser would be redirected toward markets outside the US tariff perimeter. Latin American buyers might gain access to discounted cargoes, but competition for shipping, insurance and payment channels would intensify.

Brazilian agricultural inflation could result if fertiliser trade became subject to broader sanctions or if banks and insurers withdrew from Russian-linked transactions. Brazilian import costs could rise even without a direct tariff on Brazil.

Retaliation against US companies is a further risk.

Coercion Without Commitment

The waiver is best understood as coercion without commitment. Washington has preserved the threat needed to pressure Russia, energy buyers and sanctions facilitators, but it has avoided imposing costs that would immediately raise US fuel prices or disrupt relations with China, India, Turkey and other major purchasers.

For Brazil and other Latin American importers, the message is clear: Russian fertiliser and energy remain commercially available, but their political risk has increased. The waiver lowers today’s risk premium; it does not remove tomorrow’s tariff risk.

For US firms, the prudent assumption is that the waiver is revocable leverage, not a durable exemption. Companies should continue screening Russian-origin cargoes, reviewing country-of-origin rules, mapping indirect exposure through Latin American and Asian suppliers, and modelling a scenario in which the 100% and 500% duties take effect with little notice.

The legal structure creates a meaningful distinction between formal exposure and current enforcement. Importers and trading partners are not paying the new duties today, but they must operate under a framework in which the tariff threat remains legally available and can be reactivated by executive decision.

What It Means for You

If you import goods into the United States, the russia sanctions waiver means you are not paying the new duties today, but you should not assume they will never apply. The order leaves the tariff framework in place and preserves the administration’s ability to reverse course.

If you export from the United States to China, India, Turkey or other major Russian-energy buyers, you should model the risk of retaliatory tariffs if the waiver ends. The prospect of countermeasures is itself a reason to diversify markets and review contract clauses.

If you bank, insure or ship goods involving Russian-origin cargoes or Latin American counterparties, your compliance obligations have not disappeared. The waiver does not erase earlier sanctions, and the order directs US agencies to monitor Russian-energy purchases and sanctions evasion.

What Is Not Known

Available sources identify China, India, and Turkey as major buyers of Russian energy, but do not establish a complete, verified ranking showing that no Latin American country is among the five largest buyers, and they provide no official Latin America-specific buyer list or trade values. Exact country-by-country 2026 import values should be verified against Brazil’s Comex Stat, Mexico’s INEGI and SAT data, Argentina’s INDEC data, and UN Comtrade before publication.

The waiver has no fixed expiration date, and no scheduled six-month expiration date is reported for the Graham Act waiver itself. Its continuation depends on a later determination by President Trump or designated administration officials, rather than on a fixed date.

It is not clear whether the administration will apply a broader interpretation of the act to cover Russian fertiliser purchases, which are not identical to crude oil or natural gas under the reported wording of the secondary-tariff provisions. The exact designation of the five largest buyers also depends on the statutory methodology and subsequent US determinations.

What to Watch

Watch for any statement from President Trump or Secretary of State Marco Rubio indicating that the waiver will be terminated or modified. The order allows either official, in consultation with other administration officials, to determine when further action is appropriate.

Monitor the November 2026 midterm elections. The waiver followed a temporary easing of sanctions on Russian diesel exports intended to ease a supply crunch and lower fuel prices, and the political calculus could shift after election day.

Track the separate temporary easing of sanctions on Russian diesel exports, which runs until 7 April 2027 under OFAC General License 135.

Watch for any US designation of Brazil, Mexico or Argentina as a major purchaser, a sanctions-evasion facilitator or a country assisting Russian trade. Such a designation would turn an input-sourcing decision into a bilateral trade problem.

Finally, monitor Brazilian fertiliser import data from Comex Stat and Russian petroleum-product trade flows through UN Comtrade. Any significant increase in Russian-origin purchases could attract Washington’s attention and raise the risk of a future designation.

Related reading: Brazil Culture, the Key Figures to Know in 2026; Brazil Election 2026: Lula vs Flávio Runoff on 25 October; Who Holds Power in Brazil? Lula, Congress and the Runoff; more from Brazil.

Frequently Asked Questions

What is the russia sanctions waiver?

The russia sanctions waiver is an executive order signed by President Donald Trump on 16 October 2026 that activates but immediately suspends 500% duties on Russian goods and 100% duties on major Russian energy buyers under the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026.

Why did President Trump waive the Russia tariffs?

President Trump waived the tariffs, avoiding an immediate confrontation with major Russian-energy buyers such as China, India and Turkey. The waiver also avoids an immediate confrontation with major Russian-energy buyers such as China, India and Turkey.

Does the waiver affect Brazil’s fertiliser imports?

The waiver avoids an immediate US secondary tariff on countries buying Russian energy, but the available sources do not specifically establish that Brazilian fertiliser importers were negotiating Russian cargoes. However, Russian fertiliser could still become exposed through the 500% Russian-goods tariff, separate sanctions, or a future expansion of the administration’s interpretation.

Which Latin American countries buy Russian diesel and fertiliser?

Brazil is a major agricultural economy and a major importer of fertiliser, including Russian fertiliser.

When could the russia sanctions waiver end?

The waiver formally suspends enforcement of the measures and remains in place until the administration determines that further action is appropriate. A separate temporary easing of sanctions on Russian diesel exports runs through April 2027.

What happens if the waiver is terminated?

If the waiver is withdrawn, Russian goods could face duties of up to 500%, while goods from covered Russian-energy buyer countries could face duties of up to 100%. Brazilian agricultural inflation could result if fertiliser trade became subject to broader sanctions or if banks and insurers withdrew from Russian-linked transactions.