Trump
Imposes Sweeping Sanctions on Rosneft and Lukoil to Put Pressure on Putin
·
Rosneft
Holds 49% Share in Indian Company Nayara which Exports Refined Oil
The sanctions are among the most significant
measures that the United States has taken against the Russian energy sector
since the beginning of the war in Ukraine.
Overview
In one of the toughest measures against Moscow
since the Ukraine war began, President Donald Trump has announced major
sanctions targeting Russia’s top two oil companies — Rosneft and Lukoil.
The move underscores rising U.S. frustration with President Vladimir Putin
and marks a decisive turn in Washington’s approach toward Russia during Trump’s
second term.
Sanctions
Details
·
The sanctions, unveiled as Trump met NATO
Secretary General Mark Rutte in Washington, are described by the U.S.
Treasury as a direct hit on the “twin engines of the Kremlin’s war machine.”
·
The measures effectively restrict global financial
transactions and dealings with Rosneft and Lukoil, potentially choking a
large share of Russia’s oil revenue, which funds its war in Ukraine.
·
Treasury Secretary Scott Bessent called for
“an immediate cease-fire,” stressing that the sanctions are designed to
increase pressure on Moscow.
Trump’s
Remarks
·
Trump said he canceled a
planned Budapest summit with Putin, explaining, “It didn’t feel right to
me.”
·
He cited repeated unproductive talks with the
Russian leader: “Every time I speak with Vladimir, I have good conversations,
and then they don’t go anywhere.”
·
On the sanctions: “I just felt it was the right
time... These are very big, those are against their two big oil companies, and
we hope they won’t be on for long. We hope that the war will be settled.”
Strategic
Context
·
The sanctions represent the first major punitive
action by the Trump administration in his second term, marking a harder
line after months of mixed signals toward Moscow.
·
The Biden administration had avoided direct
sanctions on Rosneft and Lukoil to protect allied access to Russian crude, but
Trump’s move reverses that restraint.
·
Analysts said the impact will hinge on enforcement
— particularly whether Washington applies secondary sanctions to
penalize third countries doing business with Russia.
“These sanctions are a big step, but they’ll only
bite if the U.S. uses or threatens secondary sanctions,” said Daniel Tannebaum
of Oliver Wyman and the Atlantic Council.
European
Response
·
NATO’s Mark Rutte and European leaders have been
lobbying Trump to stay aligned with Ukraine.
·
Wednesday’s meeting went smoothly, with Trump
declaring, “We’re a very proud member of NATO.”
·
However, Europe remains wary — Trump’s stance has fluctuated
between support for Ukraine and overtures to Putin.
Ukraine
Factor
·
Ukrainian President Volodymyr Zelensky’s
recent visit to the White House reportedly went poorly, with Trump pressuring
Kyiv to consider territorial concessions to Russia.
·
Trump also dropped plans to supply Tomahawk
missiles to Ukraine after a phone call with Putin, later calling the
weapons “too complex” for Ukrainian forces.
·
European diplomats now see part of their mission as
countering Trump’s perception that Russia is “winning” on the
battlefield.
“It’s important to remind the president that the
Russians aren’t as good as they say they are,” said Seth Jones of CSIS.
“For peace to succeed, Russia has to feel pain.”
War
Continues
Despite new sanctions, Russia launched another wave
of missile strikes on Ukraine on Wednesday, hitting a kindergarten and
injuring civilians — a reminder that the conflict remains far from resolution.
Bottom
Line
Trump’s sanctions on Rosneft and Lukoil mark a turning
point in U.S. policy toward Moscow — signaling
mounting personal and geopolitical frustration with Putin. While the
measures could meaningfully cut into Russia’s energy revenues, their true
impact will depend on global enforcement and Trump’s political resolve
to sustain pressure in the face of shifting alliances and economic
consequences.
President
Trump announced on Wednesday that he was imposing significant new sanctions on Russia
for the first time in his second term, underscoring a new degree of frustration
with President Vladimir V. Putin after a plan for the two leaders to meet in Budapest
fell apart.
The
new sanctions were announced just as the president sat down in the Oval Office with
NATO’s secretary general, Mark Rutte, who had flown to Washington on behalf of a
coalition of European leaders desperate to keep Mr. Trump on the side of Ukraine.
The
sanctions targeted Russia’s two largest oil companies, Rosneft and Lukoil. “Now
is the time to stop the killing and for an immediate cease-fire,” Treasury Secretary
Scott Bessent said in an announcement that described the oil companies as twin engines
of “the Kremlin’s war machine.”
Mr.
Trump’s irritation with the Russian leader was evident on Wednesday. “Every time
I speak with Vladimir, I have good conversations, and then they don’t go anywhere,”
he said. “They just don’t go anywhere.”
He
explained his decision to scupper the Budapest summit that had been planned for
some time in the coming weeks. “It just it didn’t feel right to me,” Mr. Trump said.
“It didn’t feel like we were going to get to the place we have to get. So I canceled it.”
As
for the sanctions?
“I
just felt it was the right time,” he said.
The
sanctions are among the most significant measures that the United States has taken
against the Russian energy sector since the beginning of the war in Ukraine. The
Biden administration avoided levying sanctions against the companies to allow for
legal purchases of Russian oil by American allies; targeting the companies could
make a meaningful dent in Russia’s oil revenues.
Analysts
noted that enforcement of the sanctions would be important for determining if they
are effective.
“These
sanctions are a big step, but they’ve got to either use, or actively threaten to
use, secondary sanctions here on third countries,” said Daniel Tannebaum, a partner
in the consulting firm Oliver Wyman’s risk and public policy practice and an Atlantic
Council fellow.
Secondary
sanctions would target countries that do financial business with Russia.
“Look,
these are tremendous sanctions,” Mr. Trump said in the Oval Office. “These are very
big, those are against their two big oil companies, and we hope that they won’t
be on for long. We hope that the war will be settled.”
Mr.
Rutte heaped praise upon the president as the meeting hummed along. It went about
as well it could have for the secretary general. “We’re a very proud member of NATO,”
Mr. Trump said at one point. “We have a great relationship with the countries of
NATO.”
These
meetings do not always turn out so well. Mr. Rutte and the rest of Europe’s leaders
have been on a wild seesaw ride with Mr. Trump all year.
Five
days earlier, President Volodymyr Zelensky of Ukraine came to the White House to
attempt to bring Mr. Trump more firmly into the fold. Behind the scenes, the meeting
did not go so well. Mr. Trump pressured Mr. Zelensky to cede territory to Russia
so that a cease-fire on Mr. Putin’s terms might come into place.
By
now, the Europeans appear to have learned not to take it for granted that Mr. Trump
will automatically have their backs against Russia. Time and again he has proved
himself to be an ally who requires a degree of minding. Leave him be for too long,
the thinking goes, and he may be swayed by Mr. Putin.
That
is the cycle that has been playing out for months now, very much to Mr. Putin’s
benefit.
After
Mr. Trump and Mr. Putin got together in Alaska back in August, the president left
their meeting having abandoned his primary goal of securing an immediate cease-fire.
And yet, he declared the meeting to be a “10” anyhow. The Europeans rushed to Washington
en masse two days later to surround Mr. Trump and press
a charm offensive. It seemed to work, for a time.
This
same sort of cycle transpired earlier this month. The Europeans had grown hopeful
as Mr. Trump dangled the possibility that he would supply Tomahawk cruise missiles
to Ukraine. But then Mr. Putin and Mr. Trump got on the phone, and the matter of
the Tomahawks was dropped.
On
Wednesday, Mr. Trump elaborated on his thinking, calling them “highly complex” weapons
that take a long time to learn how to shoot. “So the only
way a Tomahawk is going to be shot is if we shot it, and we’re not going to do that,”
he said.
Diplomatic
as ever, Mr. Rutte chimed in: “I’m not going to comment on the Tomahawks, but when
it comes to us, and all the support for Ukraine, it is there, and it is close to
the president’s heart, and I note it.”
Another
thing that had frightened the Europeans is how Mr. Trump recently seemed to revert
to Mr. Putin’s preferred narrative that the Russians are crushing it on the battlefield,
contrary to much evidence. Defense analysts said that
one of the aims that the European coalition likely has now is to bring Mr. Trump
back around to reality.
“The
big focus, I think, is to try to correct, to push back on the narrative — which
Trump did seem to get a couple of weeks ago — that the Russians were winning,” said
Seth Jones, an analyst at the Center for Strategic and
International Studies.
“I think it’s important to remind the president
that the Russians aren’t as good as they say they are,” Mr. Jones said. “They’re
not making as much progress, and that in order for peace to succeed, the Russians
have to feel pain.”
And
still the war grinds on.
Russia
launched another barrage at its neighbor on Wednesday.
Among the targets struck was a kindergarten. Video shared by Mr. Zelensky showed
terrified parents holding their children in their arms as they fled the burning
school.