A US congressional bill proposes a harder hit on Russia’s banking and energy sector if negotiations over Ukraine fail, while Western media report that the US is considering easing sanctions on Russia, including the cap on the price of Russian oil. No further details are available.
Experts say that increasing the price cap from 60 to 70 US dollars per barrel would not affect the market, as the cap is largely symbolic and only serves as a hindrance, increasing costs for Russian oil producers. Igor Yushkov, an expert at the Financial University of the Russian Federation and the Russian National Energy Security Fund, notes, “It could be an important symbolic step, showing the US is moving towards a greater easing of sanctions. Somewhere, someone has to start.”
The US was the first to impose a ban on US companies buying oil, oil products, natural gas and coal from Russia in March 2022 and the EU followed later. The question now is whether the US will lift this ban. Yushkov believes that if several factors come together, the US may lift the sanctions. “First, if the negotiations proceed well and the parties sign a kind of peace agreement. Second, if the US continues its trade war with Mexico and Canada, its largest oil suppliers and at the same time exerts pressure on Venezuela and Iran. Then, Washington may approach Russia to show it has alternative oil suppliers. Third, this would be a significant blow to China. The US will show it is only willing to buy Russian oil if Russia is not actively cooperating with China and strengthening the global competitor of the US.”
For Russia, it would be more important to lift the sanctions on the delivery of equipment for oil field services, drilling and the refinery industry. Yushkov explains, “The problem is that the European Union has also banned the import of oil refinery equipment to Russia. If the US allows its companies to deliver this equipment to Russia, it would be an additional blow to US-EU relations.