The Daily View: Biden’s parting gift
Oil producers, oil traders, banks, oilfield service providers, insurers and energy officials; nobody was left out of Biden’s momentous sanctions package, and especially the dark fleet — the question now is whether Trump will enforce the sanctions or roll them back
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JOE Biden is going out all guns blazing.
Ten days before President-elect Donald Trump is inaugurated for the second time, he has dropped the motherlode of Russian sanctions.
He’s shooting first because he won’t be around to ask or answer questions later.
Oil producers, oil traders, banks, oilfield service providers, insurers and energy officials; nobody was left out of this momentous package, and especially the dark fleet. Of the 183 ships sanctioned, 155 were Russia-trading tankers and 68 are part of the dark fleet. The US Treasury has also been busy closing off any remaining loopholes and licenses.
This final show of force was Biden’s bid to secure the narrative that the much-maligned oil price cap his administration invented has been a success and has crippled Russia’s oil and energy commodities sector.
Many will contest that view.
But the success of this parting shot rests with Trump, and to some extent China’s appetite to continue allowing sanctioned tonnage into its ports.
That Shandong port, a key Chinese oil import hub, has signalled it will not accept US sanctioned tonnage is a potential swing factor here.
The bigger question mark though remains on Trump’s intentions when it comes to Russia.
We are still not clear whether he will enforce the sanctions that Biden has left him or roll them back.
The spin from some quarters is the Trump administration may ditch the price cap all together as he sets about brokering his promised deal with Russia and Ukraine to end the war.
While Trump proved to be trigger happy issuing sanctions last time round, he has already suggested he is less enthusiastic now about imposing additional sanctions, saying in September: “I want to use sanctions as little as possible.”
The last-minute-move from Biden, however, creates a challenge for him.
Should he try to reverse Biden’s crackdown he could face pressure from Congress, where Republican members had urged President Joe Biden to do more to crack down on Russian energy revenues.
Ultimately Biden’s parting gift may be aimed at Trump, as well as Putin.
Richard Meade
Editor-in-chief, Lloyd’s List