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Sanctions against Russia will last 'for years to come' as the US aims to cut Moscow's oil and gas revenue in half by 2030

Russian President Vladimir Putin
Russian President Vladimir Putin visiting the Korolev Rocket and Space Corporation Energia, October 26, 2023, in Korolev, Russia.Contributor#8523328
  • A senior US diplomat said that sanctions against Russia will likely stay in place through the decade.

  • Geoffrey Pyatt told the Financial Times that the restrictions aim at curbing Moscow's energy revenue by half.

  • This will help limit Russia's ability to rearm for future aggression, he said.

The US will need to keep up sanctions against Moscow through this decade, in order to cut Russia's energy revenues by half, a US diplomat told the Financial Times.

"This is something that we're going to have to stick to for years to come, as long as [President Vladimir] Putin persists in this war," Geoffrey Pyatt said, the US assistant secretary of state for energy resources.

Restricting Moscow's oil and gas revenues through the long term will ensure that Russia cannot promptly rearm itself for any future military operations, he added, in the case that peace in Ukraine is achieved.

Western sanctions were first applied in February 2022, after Russian forces invaded Ukraine that same month.

These have since included a $60 dollar price cap on oil exports, and curbs on the trade of Russian oil products and diesel. In retaliation, Moscow cut off gas flows to Europe, also adding to a drop in energy revenues.

And in November, the US applied the first sanctions on Russia's gas export, targeting a liquefied natural gas development known as Arctic LNG 2.

Sales at the country's largest oil and gas producers plummeted 41% in the first nine months of this year, the central bank recently reported.

If restrictions are maintained, the International Energy Agency predicted in 2022 that Russia's oil and gas revenues will fall by more than half, from $75 billion in 2021 to $30 billion by the decade's end.

In this year's report, it reiterated that Russia's share of internationally traded gas would be halved by 2030.

In response to Pyatt's comments, Kremlin spokesperson Dmitry Peskov told reporters that Moscow already considered the sanctions a long-term reality.

"We also have no doubt that the United States will continue to try to put pressure on Russia and the entire system of trade and economic relations, essentially destroying the format of these relations," he told reporters.

Despite diminishing outlooks for Russia's role in global energy markets, sanctions against it haven't always proved effective, and the country's energy output has been snapped up by other customers, such as India and China.

"The world economy is not limited to the US economy," Peskov added.

Meanwhile, Russian oil exports have climbed despite the price cap, as its enforcement has proved challenging. The US Treasury Department has since stepped up efforts, adding sanctions against two firms that violated the cap.

Read the original article on Business Insider

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