So, yeah, a lot happened since our last edition. Here's what I'm watching after President Trump's apparent deal with Vladimir Putin to send more Russian diesel into the global market — and potentially the U.S.

Why it matters: The diesel crunch is among the most severe effects of the Iran war and Ukrainian strikes on Russian refineries.

• Average U.S. diesel prices remain far above $6 per gallon, adding to GOP headwinds in the midterm elections. Trump says his deal will help bring costs down.

Catch up quick: Trump on Friday claimed an agreement to bring escalating Russian exports, and the Treasury Department waived sanctions to help enable it.

A few things to watch...

🗳️ The campaign trail. So far, a few Republicans in close races — including Michigan Senate candidate Mike Rogers and Alaska Sen. Dan Sullivan — have criticized the agreement.

• Republicans already saddled with Trump's unpopular policies in the midterms now face another awkward choice: whether to back his diesel deal with a dictator many of them despise, Axios' Andrew Pantazi writes.

💵 The market. Diesel futures dipped after the announcement. But analysts expressed doubt that the levels Trump is claiming will meaningfully sway prices in the U.S. and elsewhere — if Russia indeed delivers.

• Per Trump's claim, Russia will "immediately" provide what amounts to 2.24 million barrels, followed by 3.73 million next month (equivalent to around 124,000 barrels per day spread over a month), and then roughly double it thereafter.
• "In the near-term, it's hard to see the waiver helping global fundamentals for diesel much," writes economics and geopolitics analyst Rachel Ziemba.
• The global market currently has a deficit of about 1 million barrels per day, per market intel firm Kpler, and "Russia's ability to deliver additional barrels remains uncertain," writes Kpler's Michelle Brouhard.

🏛️ Capitol Hill. Rep. Brian Fitzpatrick (R-Pa.), one of those lawmakers in a close reelection fight, will try to force a House vote to block Russian oil purchases.

⚖️ The law. It's not clear if any Russian barrels will reach U.S. shores — or whether it's legal if they do.

• A bipartisan group of seven senators, in a statement, say the decision runs afoul of a 2022 law barring U.S. imports of Russian oil and petroleum products. Treasury's Office of Terrorism and Financial Intelligence said it is acting "in compliance with all applicable laws."
• Meanwhile, the White House faces an Oct. 18 deadline to begin implementing a more recent law — named after the late Sen. Lindsey Graham — that imposes fresh sanctions on Russia and trade penalties on buyers of Russian energy. But the law gives the White House discretion to waive key provisions.

🇺🇦 Ukraine. Trump is pushing Ukraine and Russia to ease attacks on energy infrastructure.

• Ukrainian President Volodymyr Zelensky, who has criticized Trump's deal, said Russia has continued its barrages even as he maintained Ukraine held back early this week.

This shows the steep decline as Ukrainian strikes have hobbled Russian refining capacity.

U.S. prices have fallen somewhat from the all-time record of $6.53 per gallon on Sept. 22, but remain at historically high levels, per AAA data.

The IMF has put some numbers around the big reasons why the 2026 oil shock hasn't been even more economically painful.

Why it matters: The global economy has weathered the oil shock better than it might have, thanks to alternative supply routes, drawing on reserves, and government support.

• The amount of oil used per unit of GDP has also been falling for decades, and all this together has "helped contain the hit to activity from the war," the fund's latest outlook states.

The big picture: In a vacuum, closure of the Strait of Hormuz would have knocked nearly a point off global GDP growth in 2026, which the IMF currently projects at 3.1%.

Threat level: "The margins of adjustment are narrowing, and might have costs that will become apparent only with time," the outlook warns.

• The new IMF report also re-ups the fund's concern that sustained, broad use of measures like fuel subsidies will erode states' long-term finances and ability to address other priorities, especially if they outlast the energy shock.

What we're watching: Oil producers' efforts to reduce exposure to the strait are an evolving story.

• Saudi Arabia plans to expand its pipeline export capacity to 10 million barrels per day, its oil minister told a Riyadh energy conference yesterday, per multiple reports.

Go deeper

🔋 EnergyX inked a binding deal to provide Trafigura, the commodities giant, with 100,000 metric tons of battery-grade lithium products over 10 years from projects in Chile and Texas.

• Why it matters: It's the Texas startup's first publicly announced lithium supply deal, and it's worth north of $2 billion in revenue at current prices, the announcement states. Mining.com has more.

🛢️ BP has sharply reduced its debt but also expects several billion dollars in write-downs this quarter largely related to the energy transition business that it's now backing off, the company said this morning.

• What we're watching: BP plans to reveal a revised strategy under new(ish) CEO Meg O'Neill on Dec. 15, it announced alongside the earnings preview today.

🍨 Scoop: Shadow Power is planning to raise up to $100 million in equity and debt to install and manage distributed battery systems, Axios Pro has learned. Go deeper

⚡️ Veir, a developer of superconducting power delivery systems, raised $110 million in Series C funding, Axios Pro was first to report. Go deeper

🛤️ Parallel, a developer of autonomous electric freight rail, raised $100 million in Series C funding. Go deeper

Want a steady diet of finance scoops and smart analysis? Talk to our sales team about Axios Pro Deals.

"I think it is ⁠going to be bedlam for the bulk of the end of the year and maybe 2027."

He's quoted in the NYT's excellent overview of "prolonged insecurity" in oil supplies and markets.