US and UK toughen sanctions on Russian energy industry

The Biden administration has imposed tougher sanctions on Russia, citing Moscow’s funding of the war in Ukraine.

The methods target over 200 organizations and individuals ranging from businessmen and executives, insurance companies, and hundreds of oil tankers.

For the first time since Moscow invaded Ukraine, the UK will join the US in directly punishing the energy companies Gazprom Neft and Surgutneftegas.

“Taking over Russian oil companies will drain Russia’s war chest – and every ruble we take from Putin’s hands will help save lives in Ukraine,” said Foreign Secretary David Lammy.

Some of the measures announced by the US Treasury on Friday will be implemented, meaning the incoming Trump administration will need to involve Congress if they want to raise them.

Washington is also moving to tighten restrictions on legal buyers of Russian energy, following Moscow’s so-called “fire shadows” for ships that ship oil around the world.

US Treasury Secretary Janet Yellen said the move “increases the risk associated with Russian oil trade, including the export and financing of Russian oil exports.”

President Joe Biden said Russian leader Vladimir Putin was “difficult”, adding that “it’s very important that he doesn’t have any breathing space to continue doing the bad things he continues to do.”

“Probably the price of gas [in the United States] they could add three or four cents a gallon,” the president said.

But, he added, the measures could “significantly affect the growth of the Russian economy”.

The President of Ukraine, Volodymyr Zelensky, thanked the US for what he called “two-tier support”.

Since the beginning of the war in Ukraine. the price of oil has been one of the main measures to reduce electricity imports in Russia.

But as Olga Khakova from the Atlantic Council’s Global Energy Center explained, its performance was “reduced” because it was also trying to prevent the amount of Russian oil in the market from falling.

This was due to concerns about the impact of the global recession.

But experts say that the oil market is now in good shape.

“US oil production (and exports) is at risk and rising, so the cost of removing Russian oil from the market, the target of today’s sanctions, will be lowered,” said Daniel Fried, senior fellow at the Atlantic Council. .

“The U.S. government has targeted a large portion of Russian oil, seeking to counter what could be false information,” Fried added.

John Herbst, the former US ambassador to Ukraine, said that although the measures were “very good”, their implementation should be important.

“Which means it’s the Trump administration that will determine whether this puts pressure on the Russian economy,” he said.