May 16, 2022

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More severe US strikes on Putin, all Russian oil imports banned

More severe US strikes on Putin, all Russian oil imports banned

Washington (AFP) – Russian President Joe Biden hit out on Tuesday by imposing a ban on Russian oil imports. In retaliation for Vladimir Putin’s attack in Ukraine. Major business, responding to the calls of the embattled Ukraine’s leader, has pushed the United States forward as Western nations seek to halt Putin’s invasion.

Americans will feel pain too – at the gas pump Biden admitted, declaring that “defending freedom would be costly.”

The imports were a stark omission in the massive sanctions imposed on Russia due to the invasion. Energy exports have maintained a steady flow of cash to Russia despite severe restrictions on its financial sector.

“We will not be part of supporting Putin’s war,” Biden said, calling the new measure a “severe blow” against Russia’s ability to fund the ongoing offensive.

Biden said the United States was acting in close consultation with European allies who depend more on Russian energy supplies and who he acknowledged may not be able to join immediately. The announcement marks Biden’s latest attempt to isolate Russia from much of the global economy and ensure that the invasion of Ukraine represents a strategic loss for Putin, even if he manages to seize territory.

“Ukraine will never be a victory for Putin,” Biden said.

Ukrainian President Volodymyr Zelensky praised Biden’s work in a tweet: “We thank the United States and the personal leadership of POTUS in striking at the heart of Putin’s war machine and banning oil, gas and coal from the US market. He encouraged other states and leaders to follow suit.”

The European Union will commit this week To phase out its dependence on Russia for energy needs as quickly as possible, but it will likely take some time to fill the void without crippling the economies of the European Union. The United Kingdom, which is no longer part of the European Union, announced on Tuesday that oil and petroleum products will be phased out from Russia by the end of the year.

Unlike the United States, which is a major oil and gas producer, Europe depends on imports for 90% of its gas and 97% of its oil products. Russia supplies 40% of European gas and a quarter of its oil. The United States does not import Russian natural gas.

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The issue of oil sanctions has created a conflict for the president between political interests at home and efforts to impose costs on Russia. Although Russian oil makes up only a small portion of US imports, Biden said he has been reluctant to ban it, cutting supplies here and driving up gasoline prices.

Inflation has peaked in 40 years, driven in large part by gas prices, and it could hurt Biden ahead of the November midterm elections.

“Putin’s war is really hurting American families at the gas station,” Biden said, adding, “I will do everything in my power to reduce Putin’s price hikes here at home.”

Gas prices have been rising for weeks due to the conflict and the anticipation of possible sanctions on the Russian energy sector. The average price of a gallon of gasoline in the United States hit a record $4.17 on Tuesday, up 10 cents in one day, and up 55 cents since last week, according to the AAA Automobile Club.

Biden said he understood that prices were going up, but warned the US energy industry against “excessive price increases” and consumer abuse.

Even before the US ban, several Western energy companies including ExxonMobil and BP moved to cut ties with Russia and limit imports. Shell, which bought a shipment of Russian oil this weekend, apologized for the move on Tuesday amid international criticism and vowed to halt further purchases of Russian energy supplies. Preliminary data from the US Department of Energy shows that Russian crude imports fell to zero last week in February.

In 2021, the United States imported nearly 245 million barrels of crude oil and petroleum products from Russia — a one-year increase of 24%, according to the US Energy Information Administration.

“It’s an important step to show Russia that energy is on the table,” said Max Bergmann, a former State Department official who is now a senior fellow at the Democratic-leaning Center for American Progress.

It was no surprise, Bergman said, that the United States was able to take this step ahead of European countries, which are more dependent on Russian energy.

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“All this is done in coordination, even if the steps are not commensurate,” he said. “We talk to them constantly.”

The White House said the ban on new purchases is effective immediately, but the administration is allowing 45 days to “finish” for continued deliveries under existing contracts.

Bloomberg was the first to report on Biden’s decision Tuesday.

The White House announcement comes amid bipartisan pressure on Capitol Hill to ban Russian energy and impose other economic costs.

Last week, House Speaker Nancy Pelosi gave a big boost when she announced, “Block him.”

On Monday, Democrats on the Strong Ways and Means Committee published an announcement of a bipartisan bill to ban imports of Russian oil and impose more trade sanctions on the country, according to an aide, due to the White House’s opposition to the action. before Biden made his decision.

“President Biden is finally doing what members of Congress have been pushing for all along,” Senator John Barrasso, a member of the party’s leadership, said Tuesday. “His decision to ban Russian oil is a very necessary step to kill Putin’s lucrative cow.”

Jason Furman, a Harvard University professor and former economic advisor to President Barack Obama, said: “The US economy can fully handle any of the challenges associated with high oil prices. But it will bring some challenges. We will get prices higher at the pump, and there is no way around that.” .

Pelosi said the House of Representatives will go ahead with a vote on Tuesday on a law to ban Russian oil imports, impose trade costs on Russia and expand the power of sanctions against Russians for attacks on civilians in Ukraine.

But late Tuesday, the House postponed a vote on the bill amid disagreements among lawmakers over the details. The House of Representatives was expected to vote on the bill Wednesday, according to an unidentified aide discussing the situation.

Prior to the invasion, Russian oil and gas accounted for more than a third of government revenue. Global energy prices rose after the invasion and continued to rise despite coordinated releases of strategic reserves, making Russian exports more profitable.

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As a result of the Russian invasion of Ukraine, the United States and international partners sanctioned Russia’s largest banks, its central bank and the Ministry of Finance, and moved to block some financial institutions from the SWIFT messaging system for international payments.

But rules issued by the Treasury allow Russian energy transactions to continue through non-sanctioned banks that are not located in the United States in an effort to minimize any disruptions in global energy markets.

German Chancellor Olaf Scholz said he opposes the European ban on Russian energy imports and that there is no other way to meet the EU’s needs for automobile fuel, heating, electricity and industrial use. Vice Chancellor Robert Habeck said on Tuesday that when he visited Washington last week, US officials acknowledged that Europe was in a different situation.

They told me in conversations that they would not demand or ask Germany to do the same. But I will infer from that for us, and for me, that we need as soon as possible to create the possibility of taking similar measures.”

While Russian oil makes up a small amount of total US energy imports, the US can replace Russian crude with imports from other oil-rich countries, but this could be a political problem.

Key US senators are warning the Biden administration against seeking any oil import deal from the Nicolás Maduro regime in Venezuela.

“The Biden administration’s efforts to unite the entire world against a murderous tyrant in Moscow should not be undermined by supporting a dictator under investigation for crimes against humanity in Caracas,” said Senator Bob Menendez, Speaker of the House of Representatives. Committee on Foreign Relations, in a statement issued Monday evening. “The democratic aspirations of the Venezuelan people, much like the determination and courage of the Ukrainian people, are worth much more than a few thousand barrels of oil.”

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Associated Press writers Matthew Daly, Lisa Mascaro, and Chris Megarian contributed.