NYT asks analysts if new US sanctions can derail Putin’s military strategy
Rosneft hit by US sanctions (Illustrative photo: Getty Images)
Analysts at The New York Times believe that the new US sanctions against Russia’s oil industry are unlikely to alter the war objectives of the Russian president, but overall, they will add strain to the Russian economy, according to The New York Times.
Russian companies have long been preparing for the possibility of tougher sanctions, said Tatiana Stanovaya, founder of the political analysis firm R.Politik.
In her view, Putin remains willing to absorb enormous losses to achieve his goals. Moreover, Trump could very well change his stance again.
“For Putin, this war remains existential, and he is ready to endure a lot,” she believes.
NYT notes that revenues from oil and gas sales account for roughly a quarter of Russia’s budget.
In addition, Russia’s oil industry has suffered from strikes carried out by Ukraine.
Despite this, some experts in Russia claim that the new US sanctions will not have a significant impact.
Russia’s shadow fleet
Analysts point out that Russia has learned to skillfully circumvent restrictions by using a fleet of hundreds of aging vessels that are not insured by Western companies and by conducting transactions through intermediary firms in third countries.
And since Russia accounts for about nine percent of global oil sales, any restrictions on its exports would reduce supply and drive prices upward, creating further incentives to evade sanctions.
Problems of individual companies
Journalists recall that before leaving office, the Joe Biden administration had imposed similar sanctions on Russian oil companies Surgutneftegaz and Gazprom Neft, but their impact was limited.
This was mainly due to weak enforcement of sanctions during Trump’s presidency, according to Sergey Vakulenko, an energy expert at the Carnegie Endowment for International Peace.
“Lukoil will face serious problems, but these will be Lukoil’s problems, not Russia’s,” he said.
Challenges for the Russian economy
Overall, The New York Times writes that the Russian economy is facing difficulties, though not severe enough to force Putin to change course.
Even before this week, forecasts projected that Russia’s oil and gas revenues would fall to about $100 billion this year, down from nearly $135 billion in 2024, largely due to declining oil prices.
Meanwhile, efforts by the Russian central bank to curb inflation by raising interest rates have effectively halted the wartime economic boom, slowing growth to around 1 percent this year compared to over 4 percent in 2023 and 2024, the report concludes.
US sanctions against Russia
On the night of October 23, the US Department of the Treasury announced new sanctions against Russia aimed at pressuring President Vladimir Putin to come to the negotiating table with Ukraine.
The restrictions target Russian energy giants Rosneft and Lukoil, as well as a large number of their subsidiaries.
Vladimir Putin stated that the new US sanctions would supposedly not have a significant impact on the Russian economy.
US President Donald Trump commented: “I'm glad he feels that way. That's good. I will let you know about it in six months from now. Let's see how it works.”
