AS the trade war between Russia and the United States intensifies, outgoing president Joe Biden has admitted that the latest sanctions targeting the Russian oil industry could potentially backfire as it could lead to a rise in gas prices.
On Friday, the US state Treasury Department unveiled a “sweeping” round of fresh sanctions on Russia, imposed in coordination with the United Kingdom.
The measures target two major oil producers, Gazprom Neft and Surgutneftegaz, as well as their subsidiaries and entities providing insurance and transportation services.
The US said that they have targeted over 180 vessels allegedly used to transport Russian oil in defiance of Western sanctions. It also said they have targeted a shadow Russian fleet’ contributing to the Russian economy against Ukraine.
Asked whether he is concerned that the sanctions could lead to gas prices going up, Biden said the possibility cannot be ruled out.
“Gas prices could probably increase by as much as three or four cents a gallon, but the sanctions will have a more significant impact on Russia’s ability to continue its actions in the conduct of war,” he said.
“These restrictions will have a profound effect on the growth of Russia’s economy,” Biden argued, adding that the sanctions aim to hinder Moscow’s ability to finance its military operations.
The latest package of sanctions arrived less than two weeks before the end of Biden’s term.
While the outgoing President Biden is trying to impose sanctions on the Russian government, the incoming President Donald Trump has repeatedly said that he wishes to end the conflict within 100 days once he assumes office.
Reacting to these developments by calling them “illegal.” President Vladimir Putin has said Russia has overcome the challenges caused by the sanctions, crediting them with boosting domestic industries.
Meanwhile, the Russian foreign ministry spokeswoman, Maria Zakharova, said Biden’s legacy will be defined by the “mess” he leaves behind.
The effects of the latest sanctions were felt immediately, as global oil prices surged by more than 3 per cent on Friday, reaching a three-month high as traders anticipated supply disruptions from the expanded sanctions.
