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Putin, Vladimir

US Congress Votes to Suspend Normal Trade Relations with Russia, Ban Russian Oil Imports

Strategic Insights

— 2 min read

The United States Congress has passed two bills aimed at escalating the US response to Russia's invasion of Ukraine, with overwhelming votes in the Senate and House of Representatives. The measures, which now go to President Joe Biden to be signed into law, suspend normal trade relations with Russia and ban the importation of Russian oil. This action follows a series of announcements by the US and its allies of new sanctions on Russia, including a ban on future direct US investments and penalties on family members of President Vladimir Putin and other top Russian officials.

Key Takeaways:

  • The US Congress voted to suspend normal trade relations with Russia and ban the importation of Russian oil, with the Senate approving the bills with a 100-0 vote and the House passing the trade measure by a vote of 420 to 3.
  • The bills provide the president with the authority to return to normal tariff treatment for Russia and lift the ban on Russian energy products subject to certain conditions set by Congress.
  • The US has already taken executive action to ban Russian oil, liquefied natural gas, and coal imports, and has called on Congress to revoke Russia's favored trading status.
  • The legislation strengthens Biden's hand in applying new trade penalties to Russian goods and puts the president's ban on energy imports into law, signaling it will likely stay in place until well after any end to the war in Ukraine.
  • The congressional action follows a series of announcements by the US and its allies of new sanctions on Russia, including a ban on future direct US investments and penalties on family members of President Vladimir Putin and other top Russian officials.
  • The US has blocked sanctions on Sberbank, Russia's largest financial institution, and Alfa Bank, its largest private bank, with the European Union and other Group of Seven industrial nations.
  • The bill to end normal trade relations with Russia paves the way for the US to impose higher tariffs on steel and aluminum from Russia, further weakening its economy under Putin.
  • The legislation also penalizes Russia's ally Belarus with unfavourable tariff treatment.
  • Representative Richard Neal, the Democratic chairman of the House Ways and Means Committee, stated that "We in Congress must do all we can to end the slaughter of innocent civilians, total destruction of cities, and assault on democracy in Ukraine."
  • Senate Majority Leader Chuck Schumer announced a breakthrough in backroom Senate negotiations to bring the bills up for votes before Congress leaves Washington for two weeks.
  • Senator Ron Wyden, chairman of the Senate Finance Committee, stated that "This package is about bringing every tool of economic pressure to bear on Vladimir Putin and his oligarch cronies."

Statistics:

  • The US and its allies have imposed blocking sanctions on Sberbank, Russia's largest financial institution, and Alfa Bank, its largest private bank.
  • More than 600 private-sector companies have already left the Russian market.
  • Experts predict Russia's economy will contract up to 15 percent this year, with inflation spiking above 15 percent.
  • The US has blocked sanctions on Sberbank and Alfa Bank with the European Union and other Group of Seven industrial nations.

Sources:

  • AP News
  • Reuters
  • CNN
  • The New York Times
  • The Washington Post

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