Trump Predicts Restoration of U.S. Sanctions on Russian Oil "Soon"

At this week's G7 summit in Evian, France, President Donald Trump suggested that the U.S. might reimpose sanctions on Russian oil ahead of schedule, given progress in resolving the Strait of Hormuz crisis.

At the height of the Iranian blockade of the strait, the White House lifted sanctions on Iranian and Russian oil already loaded and afloat, hoping to ease global supply concerns by augmenting available volumes (outside of the Chinese market). The waiver on Russian sanctions was extended in May, despite Ukraine's protests. Russia's oil revenues have soared in tandem with rising global prices, increasing Russian defense funding by billions of dollars and easing pressure on the Kremlin's strained federal budget.

"We took sanctions off because obviously we're not looking to impede the oil. But we're in a position to do that soon," Trump told Politico, hinting at the prospect of more abundant oil supplies via Hormuz in the near future. Separately, he told DPA that "Russia should make a deal," noting the high casualty rates on the battlefield in Ukraine.

Renewed U.S. pressure on Russian exports would help augment European and British sanctions. Both the UK and the EU doubled down on their respective sanctions regimes targeting Russia this week, taking aim at officials, businesses and individual ships. The EU added 34 people and 47 companies to its list, notably insurers and brokers who had helped smooth the flow of seaborne Russian crude shipments. Two figures in Russian shipping were named: Tahir Garayev, founder of notorious shadow fleet vessel operator Coral Energy; and Konstantin Rogach, a partner at the firm Maritime Risk Management, which arranged alternate insurance coverage for Russia-linked shadow fleet tankers after the major EU insurers backed out of the market.

Garayev (an Azeri national) started up Coral Energy in 2010 and later renamed it 2Rivers Group, a well-known name in sanctions enforcement. His firm has cultivated a close relationship with Russian oil giant Rosneft, according to the Washington Post and Wall Street Journal. The EU believes that Dubai-based 2Rivers "controls and utilizes a large proportion of the vessels in Russia's so-called 'shadow fleet,'" which is owned and managed in no small part within 2Rivers' own backyard in the UAE.

Meanwhile, the UK sanctioned more than 20 tankers and LNG carriers linked to the Russian shadow fleet, including - for the first time - ships tied to the sanctioned Arctic LNG 2 project. The additions augment the list of 600 vessels that Britain has sanctioned previously.

"As the Kremlin resorts to ever more shady tactics to sustain its war, from its ageing shadow fleet to covert finance networks, the UK remains one step ahead in shutting them down," said UK foreign secretary Yvette Cooper. "These sanctions strike at the heart of these murky efforts, to starve Putin’s war machine and defend Britain’s security."