US permits oil sales from Russia’s Sakhalin-2 Project through June 18,

The U.S. extended a waiver on Wednesday that allows oil sales from Russia's Sakhalin-2 Project through June 18, next year. This is a move that will likely allow production of liquefied gas to continue.

The general license issued by the U.S. Treasury Department is crucial for U.S. allies Japan who gets around 9% of their LNG from Russia.

The license that allows transactions with Sakhalin-2 is a waiver of sanctions imposed by the former president?Joe Biden on this project in 2022 due to Russia's full scale invasion of Ukraine.

Minoru Kihara, the Chief Cabinet Secretary, said that Japan relies on imported fuels for around 70% of its needs.

Kihara stated that "Securing LNG from overseas, such as the Sakhalin-2 Project, is very important for Japan's security of energy supply. We will continue to work with the United States, and the international community, to make sure that Japan's LNG is not hindered."

The decision was made despite the?pressure from President Donald Trump's administration in trade negotiations on China, India and Japan?to reduce their purchases of Russian oil and LNG.

Also, the department extended an exemption, which will also last until June 18, allowing transactions to be made with Russian banks, including Gazprombank, in relation to civil nuclear energy.

Japanese Prime Minister Sanae Takaichi

Sources said that Trump told attendees at a meeting in Tokyo, Japan, in October, that it would be difficult to ban Russian LNG imports and that if Japan stopped its purchases, this would make China and Russia "happy".

The majority of the supply from Sakhalin-2 is expected to cease between 2028 and 2033. (Reporting and writing by Timothy Gardner and Mariko Katsumura, in Washington DC, and Katya Glubkova in Tokyo; editing by Franklin Paul, Nia William and Thomas Derpinghaus).

(source: Reuters)