US Congress votes to suspend Russia trade status, enact Oil Ban

The United States Congress voted overwhelmingly on Thursday to suspend normal trade relations with Russia and ban the importation of Russian oil, ratcheting up the US response to Russia’s invasion of Ukraine amid reports of atrocities by Russian forces.

The measures now go to President Joe Biden to be signed into law. Action by the House of Representatives came quickly after the Senate approved the two bills with unanimous 100-0 votes on Thursday.

Lawmakers strongly supported the substance of the two bills. The House passed the trade measure by a vote of 420 to 3, and the energy ban by 413 to 9. Biden had already taken executive action to ban Russian oil, liquefied natural gas and coal to the US and called on Congress in March to revoke Russia’s favoured 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, signalling 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 allies of new sanctions on Russia. The Biden administration on Wednesday announced a new round of targeted sanctions, banning future direct US investments in Russia and imposing penalties on family members of President Vladimir Putin and other top Russian officials.

The US with other Group of Seven industrial nations and the European Union also imposed blocking sanctions on Sberbank, Russia’s largest financial institution, and Alfa Bank, its largest private bank.

The bill to end normal trade relations with Russia, requested by Biden, paves the way for the US to impose higher tariffs on steel and aluminium from Russia, further weakening its economy under Putin. It also penalises Russia’s ally Belarus with unfavourable tariff treatment.

“Ways and Means Committee members are united in our commitment to confront these atrocities and hold the Putin regime responsible for its campaign of terror against the Ukrainian people,” Neal said.

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. Some lawmakers had said failure to take action on the trade bills now would have sent the wrong message to allies and Russia.

The images coming out of Ukraine as the war drags on “are pure, pure evil. Hundreds of civilians murdered in cold blood”, Schumer said.

“This package is about bringing every tool of economic pressure to bear on Vladimir Putin and his oligarch cronies,” Senator Ron Wyden, chairman of the Senate Finance Committee, said in a statement.

“Putin’s Russia does not deserve to be a part of the economic order that has existed since the end of World War II.”

Importantly for the White House, 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.

White House officials have said sanctions by the US and more than 30 other nations have already stung the Russian economy.

Experts are predicting Russia’s economy will contract up to 15 percent this year, with inflation spiking above 15 percent. More than 600 private-sector companies have already left the market, according to a White House fact sheet.

“Russia will very likely lose its status as a major economy, and it will continue a long descent into economic, financial, and technological isolation,” the White House said.

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