Trump to resume Russian oil sanctions after billions in waivers expire

The US is expected to reimpose oil sanctions on Russia after a waiver that channeled billions of dollars to Moscow expired, tightening the financial squeeze on Vladimir Putin's war effort.

President Donald Trump told Group of Seven leaders he will soon resume enforcing oil sanctions on Russia, ending a temporary waiver that provided Moscow with billions of dollars in crude revenue, Senator Jerry Moran said.

"Continued sanctions relief for Russia goes against our national interests," Moran, a Kansas Republican who opposed the waiver on the Senate floor, said. "Sanctions have proved effective at choking off critical revenue for Moscow."

The waiver's expiration comes as US crude prices have retreated to levels last seen in March, reflecting the market impact of existing restrictions. Despite the financial reprieve, Russian forces have failed to achieve a breakthrough in Ukraine while domestic discontent inside Russia is rising, Moran noted.

The decision forces Putin to choose between funding the war in Ukraine and providing for his own people, tightening a fiscal squeeze that could reshape the conflict's trajectory. The resumption of enforcement is expected to further deprive Moscow of the oil revenue it needs to sustain military operations.

The US temporarily waived oil sanctions earlier this year, a move the administration framed as a response to supply disruptions linked to the Iran conflict. The waiver provided Russia with billions of dollars in oil revenue at a time when Western allies were seeking to maintain economic pressure on Moscow.

The last time the US tightened oil sanctions on Russia, in early 2022 after the invasion of Ukraine, Brent crude surged above $130 a barrel while the ruble initially plunged more than 30% against the dollar before recovering on capital controls and energy export earnings. This time, the impact may be more contained: global oil markets have adjusted to reduced Russian supply, and Moscow has redirected crude flows to China and India at discounted prices.

Russia's Fiscal Squeeze Intensifies

Oil and gas revenue accounts for roughly one-third of Russia's federal budget, according to International Energy Agency estimates. With the waiver expired and enforcement resuming, Moscow faces a tighter fiscal outlook just as military spending consumes an increasing share of state resources. Russia's central bank has warned that sustained sanctions pressure could push the economy toward stagflation, with inflation running above the 4% target and economic growth slowing.

European allies have also explored measures to tighten the sanctions regime. Analyst Jason Corcoran has argued that Europe should match Russia's willingness to use nationalization as a tool, suggesting Western governments could seize Russian assets more aggressively to fund Ukraine's defense and reconstruction.

What Comes Next

The Trump administration has not specified a timeline for the enforcement resumption, but Moran's public statement and the president's G-7 discussions suggest action is imminent. The next test will come when the Treasury Department issues guidance on enforcement priorities, including whether secondary sanctions will apply to buyers of Russian crude.

For Ukraine, the renewed pressure offers a potential lifeline. "Russia's economic squeeze will further aid the Ukrainians in the defense of their homeland," Moran said.

This article is for informational purposes only and does not constitute investment advice.