House Republicans Call for ‘Comprehensive’ Sanctions on Russian Energy
Four Republican leaders of the House Financial Services Committee on Dec. 18 urged the Biden administration to impose “comprehensive energy sanctions” on Russia, saying the existing price cap on Russian oil sales has failed to choke off revenue that Moscow uses to fund its war in Ukraine.
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“At a time when [President Joe Biden] is requesting supplemental appropriations for Ukraine, it is inexplicable for the administration to keep greenlighting billions of dollars in revenues each month for Moscow’s war machine,” the lawmakers wrote in a letter to National Security Adviser Jake Sullivan and obtained by Export Compliance Daily. “How can the right hand rebuild while the left hand destroys?”
The letter supports ending the Treasury Department’s licensing of energy-related transactions with sanctioned Russian banks and said the Office of Foreign Assets Control should make “additional designations … not merely of Russia’s financial institutions, but also third-country entities that purchase Russian crude." The lawmakers also urged the administration to work with allies to tighten EU sanctions on Russian oil and gas exports.
The letter is signed by Reps. Patrick McHenry of North Carolina, who chairs the full Financial Services Committee; Blaine Luetkemeyer of Missouri, who chairs the National Security, Illicit Finance, and International Financial Institutions Subcommittee; Andy Barr of Kentucky, who chairs the Financial Institutions and Monetary Policy Subcommittee; and French Hill of Arkansas, who chairs the Digital Assets, Financial Technology, and Inclusion Subcommittee.
Treasury and the White House didn't respond to requests for comment.
Following Russia’s February 2022 invasion of Ukraine, the Group of Seven nations imposed a $60/barrel price cap on Russian oil (see 2212050014). Supporters say the cap has kept the global oil market stable while restricting the Kremlin’s revenue. Treasury Secretary Janet Yellen said in September that she believes the cap is still working (see 2309080073). Critics, however, say Russia has found ways around the cap, such as by assembling a “ghost” or “shadow” fleet of ships to illegally transport its oil.
The four lawmakers sent their letter the same day the EU announced a wide range of new sanctions against Russia, including “tighter compliance rules to support the implementation of the oil price cap and clamp down on circumvention” (see 2312180070). The enhanced rules include a measure to better track sales of tankers to third countries to prevent those ships from being used in shadow fleets.