The Biden administration on Friday imposed its broadest package of sanctions yet targeting Russia’s oil and gas revenues in an attempt to give Kyiv and the incoming administration of Donald Trump leverage to reach a deal for peace in Ukraine, Reuters reports.
The move is meant to cut Russia’s oil revenues for the war that started in February, 2022.
The measures are “the most significant sanctions yet against the Russian energy sector, the largest source of revenue for the Kremlin’s war machine,” a senior Biden official told reporters in a call.
The U.S. Treasury slapped sanctions on Russian companies Gazprom Neft and Surgutneftegas that explore, produce and sell oil and 183 vessels that have shipped Russian oil, many of which are in the so-called shadow fleet of aging tankers operated by non-Western companies. They also include networks that trade the petroleum.
The logic of the sanctions “is to hit every stage of the Russian oil production and distribution chain,” the official said. They should cost Russia billions of dollars per month, if sufficiently enforced, the official said.
The sanctions target oil producers, tankers, intermediaries, traders, and ports.
“There is not a step in the production and distribution chain that’s untouched and that gives us greater confidence that evasion is going to be even more costly for Russia,” the official said.
Global oil prices jumped more than 3% with Brent crude nearing $80 a barrel. Oil prices rose ahead of the Treasury announcement as a document mapping out the sanctions circulated among traders in Europe and Asia.
