The Biden administration plans to impose more sanctions on Russia over its war on Ukraine, taking aim at its oil revenues with action against tankers carrying Russian crude, three sources with knowledge of the matter said.
President Joe Biden’s administration has sought to shore up support for Ukraine before President-elect Donald Trump takes office on Jan. 20, given the Republican leader’s frequent complaints about the cost of U.S. support for Ukraine.
“It’s a very substantial package. Two Russian oil companies, more than 100 tankers, oil traders, Russian insurance companies etc.,” one of the officials said, without naming the entities.
It is unclear what Trump’s approach to sanctions on Russia will be.
The Biden administration is planning sanctions targeting tankers that carry Russian oil sold above the West’s $60 per barrel price cap, the sources said.
Even if sold above the price cap, Russian crude has typically sold at a discount to the overall market, and China and India have been willing to purchase supplies.
The U.S. admininstration has informed India’s foreign ministry about the upcoming sanctions, the first official said, noting a market awash with oil and the fact that oil prices are low could help India meet its crude requirements.
India’s foreign ministry did not immediately respond to a Reuters’ request for comment.
A second source said the sanctions were likely to target some of the people involved in the networks trading oil above the price cap.
Russia has used a so-called shadow fleet of ageing ships to evade the cap. Many of the vessels are less safe and prone to spilling oil, shipping experts say.
Since Russia’s February 2022 invasion of Ukraine, the U.S. has sanctioned dozens of the ships, out of a fleet estimated to be in the hundreds, to reduce Moscow’s ability to fund the war.
U.S. Treasury Secretary Janet Yellen told Reuters last month that the U.S. was looking at further sanctions on the tankers and would not rule out sanctions on Chinese banks as it seeks to reduce Russia’s oil revenue and access to foreign supplies.
The Treasury’s Office of Foreign Assets Control did not immediately respond to a request for comment on Sunday.
The G7, the EU and Australia imposed the $60 cap on Russian oil in late 2022, banning the use of Western maritime services such as transport, insurance and financing for shipments of oil priced at or above the cap.
Last month, the British government sanctioned 20 ships and two trading firms for allegedly being involved in the Russian oil trade.
Russia is among the world’s top three oil producing countries.
(Reporting by Timothy Gardner and Nidhi Verma; Editing by Christian Schmollinger, Florence Tan and Kate Mayberry)