New round of sanctions: Why is Trump destroying the U.S. economy?

The restrictions on Russian oil and gas will send prices soaring to the sky and trigger a global crisis.

Author: Irina Mishina

Commentary guest:

Andrei Suzdal'tsev Igor Yushkov

If Russia does not stop its military actions in Ukraine, European countries plan to implement a new round (the 17th) of sanctions against Russia. The EU plans to coordinate its actions with possible measures that the United States may take. French Foreign Minister Jean-Noël Barro stated this in an interview with AFP.

"I have promised Senator Lindsey Graham that we will make efforts to coordinate these two rounds of sanctions," Barro said.

Every time the topic of sanctions on Russia is mentioned, Republican Senator Lindsey Graham appears on stage. He is considered an extreme anti-Russian hawk and also a member of Donald Trump's "inner circle." It was Graham who called the involvement in the Ukrainian conflict a "good investment" and expressed joy at the absence of American casualties.

Since 2014, nearly 29,000 sanctions have been imposed on Russia, 92% of which were implemented after February 2022. The United States has imposed the most sanctions, accounting for 25.5%.

It seems there is nothing more we can be threatened with. However, Senator Graham threatens Russia with particularly "devastating" sanctions. According to Bloomberg, his proposed bill draft suggests imposing a 500% tariff on goods imported from countries purchasing Russian oil, petroleum products, natural gas, or uranium. At the same time, American citizens will be prohibited from buying Russian sovereign bonds. Reuters reported that sanctions may affect Gazprom and other companies engaged in natural resource businesses.

Senator Graham also threatened that severe sanctions will become an important tool to pressure the Kremlin into negotiations.

It remains unclear whether Donald Trump will approve these sanctions, but it is evident that the United States is shifting from diplomatic channels to pressure tactics. Does this mean the U.S. is exiting the negotiation process, and will it force Russia to make concessions and surrender under Western conditions?

Carrying these questions, we interviewed Andrei Suzdal'tsev, Deputy Dean of the World Economy and Politics Institute of the National Research University Higher School of Economics, Candidate of Historical Sciences, and political scientist.

"This is blackmail. The U.S. is unlikely to exit negotiations because they have their own interests in Ukraine. Exiting negotiations would actually mean the U.S. admitting failure in resolving the Ukraine-Russia conflict. This would be seen as a setback similar to the one the U.S. suffered in Afghanistan by the international community."

For this reason, the U.S. is now trying to use every possible means of pressure. However, their actions are clumsy and ill-considered. The problem lies in the fact that the U.S. State Department lacks excellent experts on Russia and Ukraine issues."

"Free Media (SP)": What exactly is the U.S. insisting on? After all, so far, Russia has not announced any specific plans for Ukraine. Only the plan proposed by Vikharev has been presented, which the U.S. once put forward to European officials in Paris. So far, no official document recording peace terms has been submitted to Russia. What is the U.S. aiming to achieve?

"In fact, without proposing any substantive content, the U.S. implies that we should surrender. Considering the current front-line situation, this is like Hitler offering to surrender to the Soviet Union in April 1945. Meanwhile, while talking about peace, the U.S. continues to provide intelligence and weapons to Ukraine.

The U.S. will never exit this game because the current Ukraine conflict is essentially a struggle for the legacy of the disintegrated Soviet Union. No sanctions can stop us: what matters to us is liberating the truly Russian territories in southern Ukraine, especially Odessa and Nikolaev."

"Free Media (SP)": If these sanctions are eventually implemented, what do they mean for Russia and the world economy?

"Implementing these sanctions will first hit the U.S. economy itself. Global fuel prices will skyrocket, including domestically in the U.S., and Trump will be blamed in the same way people blame Biden. I don't rule out the possibility that the implementation of the 17th round of sanctions against Russia may trigger a global economic crisis." Andrei Suzdal'tsev believes.

Meanwhile, on May 2nd, U.S. State Department spokesperson Tami Bruce said that the U.S. is changing its "style and approach to solving peace mediation issues" and is turning to increased economic pressure on Russia.

What changes will the new round of sanctions mainly targeting the oil and gas sector bring to the Russian economy? To answer this question, we interviewed Igor Yushkov, an expert from the Government Finance University and the National Energy Security Fund.

"A 500% tariff on countries purchasing hydrocarbons from Russia will mainly affect India and related countries – they are the main importers of Russian oil. They buy about 4 to 5 million barrels of oil per day from Russia. Overall, Russia exports around 7 million barrels of oil per day.

This won't make much difference for related countries because the U.S. has already imposed punitive tariffs on their goods, so they virtually do not export anything to the U.S. Therefore, related countries are unlikely to stop buying Russian oil. However, this may have a significant impact on India, which buys oil from Russia at preferential prices. India will have to decide how important sales of its goods to the U.S. market are, or if they can sell them to Europe."

"Free Media (SP)": If these countries were to abandon purchasing Russian oil, what kind of impact would it have on the world economy?

"If these countries stop buying Russian oil, we will have to reduce oil production. This will trigger a global crisis, and international market oil prices will soar to $150 to $200 per barrel. Prices for oil from any exporting country will reach this level. Ultimately, both the U.S. and Europe will be affected. This will be a serious economic crisis.

This will also affect the U.S., as its fuel prices depend on international market prices. I can speculate that diesel and gasoline prices in the U.S. will become extremely high. In this case, Trump will inevitably be accused of leading the U.S. economy into a dead end."

"Free Media (SP)": What consequences might Western sanctions on Gazprom lead to?

"If these sanctions are implemented, our natural gas supply to Europe will decrease by 15 to 16 billion cubic meters. If Turkey also abandons Russian natural gas, the situation will worsen further. Natural gas prices will far exceed $600 to $700 per cubic meter.

I don't know if related countries will buy Russian natural gas at such prices. This is also a big problem for Japan and South Korea, which purchase Russian natural gas through the 'Sakhalin-2' project.

For the U.S., this will not constitute a blow because the U.S. is not a natural gas importer. From this perspective, Washington can continue to push Russia out of the global natural gas market by sanctioning Gazprom. In this regard, Russia indeed faces the risk of suffering significant losses." Igor Yushkov stated.

Original article: https://www.toutiao.com/article/7501274682012844607/

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