The Biden administration is poised to implement additional sanctions targeting Russia’s oil revenues in response to its ongoing war against Ukraine, specifically focusing on tankers transporting Russian crude oil. This move comes as President Biden aims to bolster support for Ukraine ahead of President-elect Donald Trump’s inauguration on January 20.
Key Highlights:
Sanction Details:
The new sanctions will target two Russian oil companies, over 100 tankers, oil traders, and Russian insurance firms.
The Biden administration plans to impose sanctions on tankers carrying Russian oil sold above the $60 per barrel price cap established by the G7, EU, and Australia.
Market Context:
Despite the price cap, Russian crude has often been sold at a discount, with countries like China and India continuing to purchase supplies.
The U.S. has notified India’s foreign ministry about the forthcoming sanctions, recognizing that low oil prices could assist India in meeting its crude needs.
Targeting Trading Networks:
The sanctions are expected to focus on individuals involved in trading oil above the price cap, particularly those operating within Russia’s “shadow fleet” of aging tankers, which are often less safe and more prone to spills.
Previous Sanctions:
Since Russia’s invasion of Ukraine in February 2022, the U.S. has sanctioned numerous vessels from a shadow fleet estimated to be in the hundreds, aiming to diminish Moscow’s funding capabilities for the war.
Statements from Officials:
U.S. Treasury Secretary Janet Yellen indicated that further sanctions on tankers are being considered, including potential measures against Chinese banks involved in facilitating Russian oil transactions.
International Cooperation:
The $60 price cap was implemented in late 2022 to restrict the use of Western maritime services for oil shipments priced above this threshold. Last month, the British government sanctioned 20 ships and two trading firms linked to the Russian oil trade.