“Sand in the gears”: U.S. deliberately makes lenient sanctions to keep petrol prices low – WSJ
26 June 2024 14:54
The administration of US President Joe Biden is pursuing a very cautious policy of sanctions against oil exporting countries such as Russia, Iran and Venezuela to keep fuel prices stable ahead of the US elections. This is stated in an article by The Wall Street Journal, according to "Komersant Ukrainian"
A senior administration official explained the strategy:
“The president wanted to do everything he could to ensure that American consumers have the lowest price at the pump because it affects the daily lives of families.”
This policy has resulted in less stringent sanctions against key oil-producing countries. For example, the recent sanctions against Iran, according to analysts, affect only a portion of the country’s oil exports and are unlikely to have a significant impact on global markets. At the same time, Iran’s oil exports have increased significantly since the beginning of Biden’s presidency, reaching more than 1.5 million barrels per day since February this year.
A similar situation is observed in relation to Russia. Despite the new sanctions imposed on 12 June, they were mainly targeted at banks, leaving the country’s oil industry almost untouched. Furthermore, when the Treasury Department imposed sanctions on the Russian state-owned tanker owner Sovcomflot, licences were simultaneously issued exempting the entire company’s fleet, except for 14 of the 91 vessels.
John Smith, partner at Morrison Foerster and former head of the US Treasury Department’s Office of Foreign Assets Control, said:
“The U.S. and its allies have been very, very careful not to go too far and damage the functioning of Western economies.”
This policy is causing frustration among some in the US Treasury Department, who believe that not enough is being done to counter the oil trafficking networks that move Russian and Iranian oil.
Proponents of this strategy in the Biden administration argue that such actions allow for a balance between keeping fuel prices low and reducing the profits of oil exporting countries. As a senior Treasury official put it:
“Our two goals – lowering costs for the American people and lowering profits for the Kremlin – are very well aligned.”
They emphasise that the moves “throw sand in the wheels of the oil export machines of Russia and Iran”, meaning that these countries earn less for each barrel of oil sold.
Sanctions are not the only area where the United States is fighting the aggressor with half-hearted efforts. In particular, the US has come up with a “Ukraine success strategy” that does not involve deep strikes against Russia.
