WASHINGTON. President Joe Biden, in a bigger blow to the Russian economy, on Tuesday ordered a ban on Russian oil imports in response to Vladimir Putin’s attacks on Ukraine. A major trade move in response to the pleas of Ukraine’s warring leader has pushed the US forward as Western countries seek to stop Putin’s invasion.
Americans will feel the pain too — at the gas station,” Biden admitted, saying, “Defending freedom will come at a cost.”
The import was a glaring omission from the massive sanctions imposed on Russia in connection with the invasion. Export of energy resources provides a stable inflow of funds to Russia, despite severe restrictions in its financial sector.
“We will not participate in subsidizing Putin’s war,” Biden said, calling the new move a “powerful blow” to Russia’s ability to finance an ongoing offensive.
Biden said the US acted in close consultation with European allies, who are more dependent on Russian energy supplies and who, he acknowledged, would not be able to immediately join them. The announcement marked Biden’s latest attempt to cut Russia off from much of the world economy and ensure that an invasion of Ukraine would be a strategic loss for Putin even if he succeeded in capturing the territory.
“Ukraine will never be a victory for Putin,” Biden said.
Ukrainian President Volodymyr Zelensky tweeted to praise Biden’s actions: “Grateful for the personal leadership of the US and @POTUS in striking at the heart of Putin’s war machine and banning oil, gas and coal from the US market. We call on other countries and leaders to follow suit.”
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This week, the European Union is committed to ending dependence on Russia for energy needs as soon as possible, but filling the void without hurting the EU economy is likely to take some time. The UK, which is no longer part of the EU, announced Tuesday that oil and oil products from Russia will be phased out by the end of the year.
Unlike the US, which is a major producer of oil and gas, Europe depends on imports for 90% of gas and 97% of petroleum products. Russia supplies 40% of gas to Europe and a quarter of oil. The US does not import Russian natural gas.
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The problem of oil sanctions has created a conflict for the president between political interests at home and attempts to put the cost on Russia. While Russian oil makes up only a small portion of US imports, Biden said he doesn’t want to ban it, cutting supplies here and raising gasoline prices.
Inflation is at a 40-year high, fueled in large part by gas prices, and that could hurt Biden ahead of the November midterms.
“Putin’s war is already hurting American families at the gas station,” Biden said, adding, “I’m going to do everything in my power to minimize Putin’s price hikes here at home.”
Gas prices have been rising for several weeks due to the conflict and in anticipation of potential sanctions against the Russian energy sector. The average U.S. gallon gas price hit a record $4.17 on Tuesday, up 10 cents in a single day and 55 cents from last week, according to Auto Club AAA.
Biden said it was understandable that prices were rising, but warned the US energy industry against “excessively raising prices” and exploiting consumers.
Even before the US ban, many Western energy companies, including ExxonMobil and BP, decided to sever ties with Russia and restrict imports. Shell, which bought a shipment of Russian oil this weekend, apologized for the move on Tuesday amid criticism from the international community and vowed to halt any further purchases of Russian energy. Preliminary data from the US Department of Energy show that Russian oil imports fell to zero in the last week of February.
The US imported approximately 245 million barrels of crude oil and refined products from Russia in 2021, up 24% year-on-year, according to the US Energy Information Administration.
“This is an important step to show Russia that energy is on the table,” said Max Bergmann, a former State Department official and now a senior fellow at the Democratic-leaning Center for American Progress.
Bergmann said it was not surprising that the US was able to take the step ahead of European countries, which are more dependent on Russian energy resources.
“It’s all done in concert, even if the steps aren’t symmetrical,” he said. “We talk to them all the time.”
The White House said the ban on new purchases went into effect immediately, but the administration allowed a 45-day “roll-up” to continue deliveries on existing contracts.
The news of Biden’s decision on Tuesday was first reported by Bloomberg.
The White House announcement came amid bipartisan pressure on Capitol Hill to ban Russian energy and impose other economic costs.
House Speaker Nancy Pelosi gave a big boost last week when she said, “Ban it.”
On Monday, Democrats on the powerful Committee on Ways and Means published and then deleted an announcement for a bipartisan bill to ban Russian oil imports and impose more trade sanctions on the country, aide said because of opposition from the White House to the acts before Biden has made a decision.
“President Biden is finally doing what members of Congress have been calling for all along,” Sen. John Barrasso, of Wyoming, and a member of the party leadership, said Tuesday. “His decision to ban Russian oil is a much-needed step to kill Putin’s cash cow.”
Jason Fuhrman, a Harvard professor and former economic adviser to President Barack Obama, said: “The United States economy can fully cope with any problems associated with higher oil prices. pump, and there’s no getting around it.”
Pelosi said the House of Representatives will vote Tuesday on legislation to ban Russian oil imports, impose trade costs on Russia, and expand the power to sanction Russians for attacks on civilians in Ukraine.
But late on Tuesday, the House of Representatives delayed a vote on the bill due to disagreements among lawmakers over the details. The House of Representatives was expected to vote on the bill on Wednesday, according to an aide who asked to remain anonymous to discuss the situation.
Before the invasion, Russian oil and gas accounted for more than a third of government revenue. World energy prices have risen sharply since the invasion and continue to rise despite the coordinated release of strategic reserves, making Russian exports even more profitable.
As a result of Russia’s invasion of Ukraine, the US and international partners have imposed sanctions on major Russian banks, its central bank and the Treasury Department, and have taken steps to block some financial institutions from accessing the SWIFT messaging system for international payments.
But rules issued by the Treasury Department allow Russian energy deals to continue to flow through non-sanctioned banks that are not based in the US to minimize any disruption to global energy markets.
German Chancellor Olaf Scholz said he opposes a European ban on energy imports from Russia and that there is no other way to meet the European Union’s needs for motor fuel, heat and electricity, and for industrial use. Vice Chancellor Robert Habeck said Tuesday that when he visited Washington last week, US officials recognized that Europe is in a different situation.
“During the talks, I was told that they would neither demand nor ask Germany to do the same. But I would extrapolate this for us and for myself, that we need to create an opportunity for such measures as soon as possible.
While Russian oil makes up a small portion of total US energy imports, the US could replace Russian oil with imports from other oil-rich countries, but this could be politically problematic.
Key U.S. senators are warning the Biden administration against making any oil import deals with the regime of Nicolás Maduro in Venezuela.
“The Biden administration’s efforts to unite the world against a bloodthirsty tyrant in Moscow must not be undermined by support for a dictator under investigation for crimes against humanity in Caracas,” said Sen. Bob Menendez, DN.J., chairman of the Foreign Relations Committee, in a statement. late Monday evening. “The democratic aspirations of the Venezuelan people, like the determination and courage of the people of Ukraine, are worth much more than a few thousand barrels of oil.”
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AP contributors Matthew Daly, Lisa Mascaro, and Chris Megerian contributed.
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