Heavy sanctions were issued today (10.1.2025) the Biden government a few days prior to taking over Donald Trump’s duties aimed at the Russian energy sector, targeting Moscow’s oil revenues. The measures include sanctions against Russian oil producers Gazprom Neft and Surgutneftegas, as well as the blacklist 183 ships involved in Russian energy exports. Tens of traders, Russia-based oil service providers and energy officials have also been targeted, Financial Times reports. CORVERSE The US Treasury said the United Kingdom would apply sanctions to the two major oil producers in coordination with Washington. “The treatment of Russian oil companies will drain Russia’s war chest – and every ruble we take out of Putin’s hands helps save Ukrainian lives,” UK Foreign Minister David Lami said today. Brent oil, increased to a high of three months to $79 per barrel after the announcement. Biden’s outgoing group said it was able to take such important action for Russia’s energy sector, the country’s largest and most important source of revenue, because oil markets are expected to have a surplus supply in 2025. He also noted that inflation in the US has decreased in scope within the US Federal Bank’s 2% target. “To put it simply, the framework changed and so the moment was ripe to change our strategy,” said a senior Biden government official. The last-minute move poses a challenge for elected President Trump, who campaigned for the rapid end of the war between Russia and Ukraine and has expressed scepticism about imposing additional sanctions, saying in September: “I want to use sanctions as little as possible”. In case he tries to undo the moves, Trump could face pressure from Congress, where Republican members had urged President Joe Biden to do more to counter Russian energy revenues. On the basis of the existing sanctioning authorities, Congress will be informed whether Trump tries to overturn the new measures and could vote for a vote of censure. The outgoing Biden team said sanctions would be a useful tool for the new Trump government, which has largely distanced itself from Biden’s strategy for Ukraine. While in the campaign, Trump pledged to end the war between Russia and Ukraine within 24 hours, although now he says he will try to end it in six months. “The next government should make a decision on what it wants to do, but we believe that by taking these measures, it puts it in a better position to help find fair and sustainable peace than this conflict,” said another senior government official Biden. As part of the package, the State Department blocked two active Russian liquefied gas facilities, a major Russian oil project and foreign organizations supporting Russia’s oil exports. He also blacklisted oil service providers based in Russia and senior officials of the state nuclear power company Rosatom. Adding 183 ships directly to the list of sanctions, instead of the companies that manage them or belong to them, can have a significant effect. The FT analysis found that the 54 oil tankers previously blocked by the US were forced to carry dramatically less oil, because it became more dangerous for their counterparties to cooperate with them. Some of the ships on which sanctions were imposed on Friday had been recorded for making “visit visits to a Russian port where oil was steadily negotiating well over the $60 price ceiling for Russian crude oil.” As of December 2022, Ukraine’s allies tried to maintain the flow of Russian oil, but to limit Kremlin’s revenue from trade, setting a limit on price. Ingosstrakh, a large Russian company previously identified by the FT as a major ship insurer of the shadow fleet, has also been added to the list. If the new sanctions are fully implemented, they will undermine Russia’s oil revenues and increase its energy costs by over billions per month, said the first Biden government official. “We are increasing the risk of sanctions related to Russia’s oil trade, including shipping and financial facility to support Russia’s oil exports,” US Finance Minister Janet Yelen said. The US has imposed more than 5,000 export sanctions and controls on Russia since it began its full-scale invasion of Ukraine in February 2022. Friday’s measures follow the Biden government’s November 2024 decision to impose sanctions on Russia’s state-owned Gazprombank, Russia’s main payment pipeline, as part of its efforts to limit the Kremlin’s ability to finance his war effort.
Extensive sanctions from the US on Russian oil
—