On January 10, the US Treasury Department announced sanctions against Gazprom Neft and Surgutneftegas, companies that explore, produce, and sell oil. In addition to major oil and gas producers, the US is targeting more than 30 oilfield service providers and insurance companies linked to Russia.

The sanctions also target 183 vessels that have transported Russian oil, many of them part of the so-called “dark fleet” of older tankers operated by non-Western companies.

The Treasury Department also revoked a provision that exempted Russian banks from sanctions that mediate energy payments. The measures allowed a pause until March 12 for sanctioned entities to complete energy transactions.

These are arguably the toughest sanctions yet against Russia’s energy sector. At a press conference, a representative of the US Treasury said that the main goal of this large-scale stimulus package is not only to reduce income, but also to destroy Russia’s production capacity, as well as to stimulate importers to seek alternative sources of supply.

How are Russia's energy industry and the global oil market affected?

Gazprom Neft said that over the past two years, the company has been preparing for various negative sanctions scenarios. TASS quoted a source in the company's press service as saying that since 2022, Gazprom Neft has been subject to a number of unilateral foreign sanctions, so these restrictions are taken into account in the company's strategy. "The company will continue to operate and maintain business stability," the company said.

According to Stanislav Mitrakhovich, a leading expert at the Russian National Energy Security Fund, the new US restrictions could increase costs in terms of technological re-equipment, the number of intermediaries between importers, and increased discounts on Russian crude. However, the Russian energy industry will overcome this challenge; because this is not the first time the embargo has been imposed. According to Argus, the current discount is $13 per barrel, but by 2022, the discount will be more than $30 per barrel.

Meanwhile, Alexander Frolov, deputy director general of the Russian National Energy Institute, said that restrictions on specific oil companies would require Russia to restructure some processes. “From the beginning of 2022, sanctions were imposed immediately on the oil refining industry, and the supply of technology, equipment and services to the Russian oilfield service industry was limited. Now the restrictions no longer apply to the entire industry, but to individual enterprises. Moreover, secondary sanctions are possible,” Izvestia quoted Alexander Frolov as saying.

According to Alexander Frolov, over the past three years, Russian oil companies have had to struggle to adjust their production processes and business strategies to suit the new context, the reality of being surrounded by embargoes.

For the global oil market, the new US sanctions against Russia will have negative impacts, especially in terms of causing fluctuations in world oil and gas prices. However, experts say the extent of the impact will depend on the decision of the upcoming Trump administration to maintain or cancel them to some extent.

Alexander Frolov believes that the new US President will find it difficult to accept oil prices at $120/barrel. For Russia, this is a “gift” because the energy sector is a key industry and brings in the majority of the country’s national budget. However, the increase in fuel prices in the US will hardly satisfy local people. At that time, the level of trust of US voters in the new President Donald Trump will inevitably be affected.

The purpose behind the US sanctions package

In November 2024, amid escalating tensions between Moscow and Washington, the US introduced a package of sanctions against the Russian banking sector. Currently, the Russian energy sector is also under “suffocating” pressure.

Analysts say that the increased pressure on sanctions against Russia from the US in recent months may be due to the upcoming change of power in the White House. First, President-elect Donald Trump made statements pledging to quickly resolve the conflict in Ukraine, which seems to have not been “satisfactory” to the current administration of President Joe Biden and Ukraine.

Second, Mr. Trump publicly expressed his willingness to dialogue with Russian President Vladimir Putin, while accusing the administration of President Joe Biden of "adding fuel to the fire" of the Ukraine crisis and dragging NATO countries into this conflict.

In addition, after the US Congress officially certified the presidential election results on January 6, Mr. Trump talked about the transition of power not going as smoothly as promised. Observers said that it is possible that Mr. Trump wanted to "hint" at the tough actions of the outgoing administration, including new sanctions, providing weapons to Ukraine and allowing the Ukrainian military to use long-range US missiles to attack Russian territory.

According to Dmitry Novikov, First Deputy Chairman of the International Affairs Committee of the Russian State Duma, the outgoing administration of President Joe Biden is trying to leave a difficult legacy for his successors. In the current context, the administration of President Donald Trump will take a long time to restructure and will have difficulty in resolving domestic and foreign policy priorities. This will lower the prestige of the Republican Party, and on the contrary, strengthen the position of the Democratic Party in the next federal election.

In addition, if President Donald Trump wants to partially lift the embargo on Russia, he will need to get the approval of the US Congress. If this is disadvantageous to Washington, it is possible that Mr. Trump will be dragged into legal issues related to his “close relationship” with Russia, as he experienced because of the accusation of Russia interfering in the US election during his first term.

According to Dmitry Novikov, the imposition of new sanctions is in principle a continuation of the general line established by the recent US administration. The appearance of President Donald Trump will not mean a positive turn in US-Russia relations and the Trump administration will seek to maintain its dominance in the international arena. In fact, during his first term, Trump also imposed many sanctions on Russia and made many decisions that escalated tensions in relations between the two powers.

Hung Anh