Yesterday, the Biden administration imposed the largest package of sanctions aimed at cutting Russia’s oil and gas revenues to give Kiev and the incoming administration of Donald Trump leverage to broker a peace deal in Ukraine. Edition Bloomberg called them “a big deal”. Daylip Singh, the White House’s chief economic and security adviser, also confirmed, that the imposed sanctions are the most extensive measures against the Russian energy sector, which is the main source of financing for President Putin’s war.
The representative of the National Security Council, John Kirby, explained that the time for the sanctions was chosen due to the stabilization of the oil markets and the improvement of the economic condition of the United States, which allows to better cope with possible market shocks.
Biden is trying to strengthen Ukraine’s negotiating position as much as possible
The Biden administration announced massive sanctions against Russia’s oil and gas revenues to strengthen Ukraine’s position in peace talks. These measures are aimed at limiting the financing of the war, which caused huge human and material losses. As the representative of the White House, John Kirby, explained, the decision was made taking into account the stabilization of the oil markets and the reduction of fuel prices in the USA, which reduces the risks for the American economy.
The US has announced a new large-scale package of sanctions aimed at the Russian oil and gas industry. These measures became one of the most powerful blows to the energy sector of the Russian Federation during the entire war and are aimed at making it difficult to export oil and gas, which provides the main income for the Russian budget.
According to the US Treasury document cited agency Reuters, the two largest Russian oil companies – “Gazprom Nafta” and “Surgutneftegaz” – were included in the sanctions list. These enterprises provided up to 20% of Russian oil exports. The monthly volume of their exports was 3.5–4 million tons. The sanctions also affected oil refineries: Moscow Refinery, Omsk Refinery – the largest in Russia, Kirishsky Refinery, as well as Gazprom Nafta Shelf, which owns the Prirazlomny field, the only one put into operation on the Arctic shelf of the Russian Federation.
Special attention was paid to the transportation of energy carriers: the sanctions list included 183 vessels associated with the so-called “shadow fleet” of Russia. Among them are ships of the Sovcomflot company, the largest shipping operator of the Russian Federation. All transactions with these companies and vessels must be closed by February 27.
Sanctions against the Russian gas sector were a separate blow. For the first time, the USA included two liquefied natural gas (LNG) plants on the sanctions list: “Kryogaz-Vysotsk” (with a capacity of 660 thousand tons per year), owned by the company “Novatek” and Gazprombank, and “Portovaya SPG” (“Gazprom”) of annual volume of 1.5 million tons. Such sanctions have already demonstrated their effectiveness: the Arctic LNG-2 plant owned by Novatek actually stopped work due to restrictions.
A blow to the infrastructure created to circumvent the restrictions
Experts believe that the sanctions will create significant difficulties for the Russian energy sector. Russia may face a shortage of “clean” oil tankers, an increase in discounts on energy exports and problems with financial transactions. As noted by lawyer Andrii Ryabinin, to whom he refers edition “Economichna Pravda”, this package of sanctions not only blocks key export flows, but also hits the logistical, financial and legal infrastructure built to circumvent international restrictions.
The new sanctions have already affected global markets. Oil prices rose by 3%, exceeding $80 per barrel. In the long term, the shutdown of facilities such as LNG plants may have a significant local effect for Russia, but the global market is able to offset these losses through alternative suppliers such as LNG plants in the US and Canada.
Thus, the US is consistently expanding and intensifying sanctions pressure on Russia, trying to cut off the main sources of funding for its military actions, while at the same time maintaining stability in global energy markets.
The US is no longer constrained by oil supply problems. The new sanctions allow sanctioned companies to complete their energy operations by March 12, 2025. However, sources in the Russian oil and gas industry and Indian oil refining companies indicate that these sanctions may significantly complicate the supply of Russian oil to the main consumers — India and China. Instead, Jeffrey Payette, the US assistant secretary of state for energy, said that this year oil supplies will increase from countries such as the US, Guyana, Canada, Brazil and possibly the Middle East. So the situation has changed, and the US and other countries should not worry about oil shortages and rising prices. New sources of supply will help offset losses due to Russian oil.
Biden’s farewell sanctions are part of a broader strategy
These sanctions are part of a broader pressure strategy aimed at weakening Russia’s economic potential to continue its aggression against Ukraine. The Biden administration has already given Ukraine $64 billion in military aid since the war began, including $500 million this week for anti-aircraft missiles and fighter jet support. This US financial effort is not only a manifestation of support for Ukraine, but also a demonstration of a joint strategy with partners to ensure security in the region.
The steps leading up to the current sanctions package laid an important foundation. The November 2024 sanctions, which targeted major banks, including Gazprombank, significantly limited Russia’s ability to conduct energy-related financial transactions. They also affected the logistical flows of Russian oil, in particular by restricting access to tankers. The consequences were significant, with the ruble falling to its lowest level since the start of the war, prompting the Russian Central Bank to raise the discount rate to over 20%, causing increased economic pressure within the country.
The new package of sanctions is aimed not only at the energy sector, but also at further limiting Russia’s ability to finance the military machine. According to representatives of the Biden administration, it is expected that the new measures will lead to an even greater increase in inflationary pressure, which already reaches about 10%. Deteriorating economic conditions in Russia could affect the government’s ability to finance domestic programs, including social benefits, putting additional pressure on the population.
However, these sanctions are not just an economic tool. They are part of a broader geopolitical approach that includes strengthening the security of NATO allies in Europe, diversifying energy markets, including increasing exports of liquefied natural gas from the United States, and financing Ukraine’s recovery programs. The United States, together with its partners, is trying to create conditions under which the Russian economy will become unable to support military aggression.
In addition, the US administration is actively involving international partners in coordinating sanctions pressure to minimize Russia’s ability to circumvent restrictions. This includes cooperation with EU countries, Japan, Canada, as well as with other key economies of the world. Joint actions help strengthen the effectiveness of sanctions and ensure global stability in energy markets, which is an important element of this strategy.
Thus, the new sanctions not only increase economic pressure on Russia, but are also an element of a comprehensive strategy aimed at long-term isolation of the aggressor, support of Ukraine, and stability of the world economy.
Why are Biden’s latest sanctions a “big deal”?
Edition Bloomberg explains why it was Biden’s farewell sanctions that reinforced all previous sanctions efforts that became important.
For the sanctions to be effective, the new US administration must be ready to take action against buyers of Russian oil. The fact is that Indian and Chinese companies have already partially shown reluctance to accept cargo transported by ships that have been sanctioned. However, this did not create significant difficulties for them, since the sanctions applied only to a part of the shadow fleet. However, the latest round of sanctions changed the situation: a significant part of the fleet came under restrictions, which generally made it difficult to trade Russian oil. As of January 2025, 270 tankers were under sanctions for transporting Russian oil.
Infographic: IA “FACT”
What sanctions did the Americans use against Russia during the war?
Let’s recall all the sanctions measures that America used to contain Russia. They can be share in several key areas. Each of them reflects the weakening of the economic, financial and technological potential of the aggressor country.
- Control over the export of technologies
The US banned the export of technology that could be used by Russia to create weapons and industry. It is about electronics, telecommunications, aviation and other high-tech industries. Such measures effectively isolated the Russian Federation from key know-how, which makes it impossible to reproduce complex equipment.
- Restrictions on trade
A ban was also introduced on the export and import of a number of goods, including energy, seafood, diamonds and luxury goods. These steps led to a record decline in trade with Russia over the past 10 years and a massive outflow of investment.
- Additional tariffs
Russia’s privileged trade status was abolished, which increased tariffs on Russian goods from 4% to 30%. This made Russian imports more expensive and less competitive.
- Limitation of oil prices
The United States, together with its partners, set a ceiling price for Russian oil of $60 per barrel. This limits the Kremlin’s income from exports while maintaining Russian supplies to world markets.
- Individual sanctions
The sanctions affected thousands of Russian officials, businessmen and companies. More than $30 billion worth of assets were frozen and access to international financial markets was blocked.
- Combating the circumvention of sanctions
The US is putting pressure on countries that can help Russia avoid restrictions. For example, tough negotiations are being conducted with China, warning of the consequences in case of Russia’s support.
These sanctions are part of a comprehensive strategy that not only weakens the economy of the Russian Federation, but also encourages the countries of the world to adhere to a common position regarding the isolation of the aggressor.
