CBS News reported on Thursday that the Trump administration is considering further restrictions on Russian oil, gas, and banking, even as the European Union (EU) prepares to remove several ultra-rich Russian oligarchs from its sanctions list under pressure from Hungary and Slovakia.
Among the final acts of the Biden administration was a 60-day waiver that allowed a dozen sanctioned Russian banks to conduct financial transactions related to energy purchases with European banks. The waiver extended an exemption to banking sanctions made earlier in the Biden years to make it possible for European consumers to keep buying Russian oil and gas with American dollars, minimizing the damage to European economies.
The Biden administration was ostentatiously imposing new sanctions on Russian oil as President Joe Biden prepared to leave office in January, but still made sure a carve-out was quietly in place for European energy purchases. The waiver was, however, given an unusually short expiration date of only two months, where six months is more common.
The 60-day waiver expired at midnight on Wednesday and the Trump Treasury Department chose not to renew it, according to “four people familiar with the plans” who spoke to CBS News.
“The decision to further restrict access to American banking systems makes it harder for other countries to buy Russian oil, thus limiting its global supply. It could lead to a price spike of up to $5 per barrel more, a notable jump after lower prices in recent weeks,” CBS noted.
Bloomberg News heard the same story from its sources, who predicted the effects could include pushing the price of oil up by a few dollars per barrel.
“If you are a foreign oil refinery or an oil trader or someone buying Russian gas and your bank wants to pay Russia for their oil and gas in dollars or by extension, really any other Western currency, you’re going find that very difficult to do,” explained former State Department official Edward Fishman.
“It’s definitely a tightening but the question is how impactful is this in terms of hard dollars or value of actual oil trade. How much flow actually went through that channel is very unclear,” said former Treasury official and Oliver Wyman consulting firm partner Daniel Tannebaum.
The Senate Foreign Relations Committee applauded President Donald Trump for putting a little pressure on Russian President Vladimir Putin to accept a ceasefire deal.
“Yesterday, President Trump closed a sanctions loophole created by the Biden Administration that allowed the sale of Russian oil and gas to Europe, despite the fact that Russian energy revenue funds its war in Ukraine. This was a great step by President Trump to increase pressure on Russia,” the Committee said.
The EU on Friday renewed sanctions against most Russian elites, but removed four oligarchs from the list under pressure from Hungary and Slovakia.
Hungary had threatened to block the scheduled six-month rollover of sanctions against President Vladimir Putin, Foreign Minister Sergei Lavrov, and hundreds of other Russian political leaders, wealthy business tycoons, and corporations unless a list of eight specific individuals were removed from the sanctions list.
After days of negotiations, and with a March 15 deadline for the rollover looming, EU negotiators whittled Hungary’s list down to three names: Russian sports minister Mikhail Degtyaryov, billionaire businessman and former World Jewish Congress president Viatcheslav Moshe Kantor, and Gulbakhor Ismailova, sister of Uzbek-Russian billionaire and Putin confidante Alisher Usmanov.
A fourth individual, businessman Vladimir Rashevsky, was removed from the sanctions list on Friday because the legal case for keeping him on the list was deemed to be weak. Hungary was not involved in pressing for Rashevsky’s removal from the list. Hungarian officials have not publicly disclosed why delisting the other people they mentioned was so important.
“The Hungarians say, ‘Look, it looks like Trump is going to make a peace deal,’ but for us there’s not even the beginning of the conditions where we would contemplate lifting sanctions,” an unnamed EU diplomat complained to Politico on Friday.
The equally unhappy foreign minister of Estonia, Margus Tsahkna, demanded the suspension of Hungary’s voting rights for “systematically working against the common security interests of Europe.”
Tsahkna said Estonia would take its own unilateral actions against the three Russians removed from the sanctions list, including banning them from entering Estonia.
