In an attempt to reduce American cash flowing to Moscow, President Biden will ban Russian energy imports into the U.S. as Russian President Vladimir Putin pushes on with his provocative invasion of Ukraine. “The United States is targeting a main artery of Russia’s economy,” Biden said Tuesday, speaking to reporters in the Roosevelt Room across the hall from the Oval Office. “We are banning imports of Russian oil and gas.” Biden also moved to block U.S. citizens from making new investments in the Russian energy sector.
In a few areas, the Russian economy was severely affected by trade and banking restrictions imposed in the U.S. as well as European countries. American Express and Visa have stopped providing service to Russia through their credit cards. Apple, Nike, and Ford have stopped Russian operations. Biden Administration officials hope a harsh oil ban will change Putin’s calculations of the cost of war and bring internal pressure in Russia to end the attack on Ukraine.
However, Putin has not been persuaded by the sanctions to change his tactics. Biden appeared to admit Tuesday that Putin shows little signs of deterring. “Putin seems determined to continue on his murderous path no matter the cost,” Biden said.
Biden initially resisted the U.S. ban on Russian oil imports from America because it could limit global energy supply and cause higher costs for American consumers, such as auto fuel and heating and electricity. Biden wanted to work in collaboration with European allies. However, European partners are heavily dependent on Russian oil for local energy requirements and so have hesitated about signing on to an absolute ban on Russian oil imports. “This is a step we are taking to inflict further pain on Putin, but there will be cost as well here in the United States,” Biden said.
Biden had an opportunity political to criticize Putin over the gas price rises that occurred before Russia invaded Ukraine. Prices for oil have gone up more than 50% in the past year. They are likely to continue rising, which will contribute to continued increases in these prices. Biden last week announced that he would be releasing 30,000,000 barrels from his strategic reserves. However, this is unlikely to impact near-term oil prices. “Putin’s war is already hurting American families at the gas pump,” Biden said.
Biden has been under increasing political pressure to ban Russian energy in recent days. “Republicans and Democrats alike have been clear that we must do this,” Biden said on Tuesday. Congress could also be able to outpace Biden and force him into action. The Democrats of Congress moved earlier this week towards legislation to ban Russian energy imports. House Speaker Nancy Pelosi wrote a note to House Democrats on Sunday that said the House is exploring “strong legislation that will further isolate Russia” and that would include a ban on Russian energy products, ending normal trade relations with Russia and Belarus, and moving to block Russia from the World Trade Organization.
Some Republicans are also calling for a ban of Russian oil. They want Biden to boost domestic energy production as well as accelerate the approval process for new leases to drill on federal lands. This was something Biden stopped when he took office. White House Press Secretary Jen Psaki told reporters on Monday that the U.S. is producing oil at “record numbers” and that there are currently 9,000 approved drilling permits not being used. “The suggestion that we are not allowing companies to drill is inaccurate,” Psaki said, adding that the Biden administration wants to take a long term approach to investing in energy production that doesn’t rely on oil. Federal lands account for less than 10% of all onshore oil leases. It can often take several years before new leases start producing oil.
In recent weeks, the Biden Administration worked to increase energy supply in order to offset declining Russian oil exports. Biden sent a delegation to Venezuela over the weekend to discuss “energy security” with the government of Nicolás Maduro, as well as the welfare of U.S. citizens held there, Psaki said Monday. Venezuelan oil imports were sanctioned by the U.S. in 2019. Weakening those sanctions could lead to a decrease in Russian oil imports. In mid-February, a week before Russian tanks rolled into Ukraine, State Department Special Envoy for Energy Affairs Amos Hochstein and the National Security Council’s Coordinator for the Middle East and North Africa Brett McGurk both traveled to Saudi Arabia to talk about ways the kingdom could help manage energy market pressures resulting from a war in Ukraine. It’s unclear if those talks have delivered the increase in global supply the Biden White House wanted.
Biden claims that spending more money on cleaner energy resources is a smarter geopolitical decision. Biden made a pitch Tuesday for funding his efforts to create a strong new U.S. energy sector to provide more alternative fuels to oil and reduce global dependence on it. “To protect our economy over the long term we have to become energy independent,” Biden said. “It should motivate us to accelerate the transition to clean energy,” he said.