WPB reports Russian President Vladimir Putin was sounding defiant when the United States sanctioned Russia's two biggest oil giants, Rosneft and Lukoil. The move, approved by President Donald Trump, is intended to pressure Moscow to end its continuing military campaign in Ukraine and has already sent world oil prices up by some 5%.
Trade sources explained that Chinese state refiners have halted buying Russian crude after the sanctions. Indian refineries, the world's biggest seaborne buyers of Russian oil, also would likely cut imports sharply. The total production of Rosneft and Lukoil represents over five percent of the world's total oil production, and the effect of Washington's action would be deep. This is a dramatic shift in Trump's strategy, since the two leaders had previously discussed a peace summit in Budapest to address the conflict.
Analysts note that though the immediate economic blow to Russia might be contained in the short run, the sanctions are a strong message of Washington's resolve to step up financial pressure on the Kremlin. The broader strategy appears to be to nudge Russia to the negotiating table following over three years of nonstop war.
Putin dismissed the sanctions as symbolic and unfriendly, asserting that the Russian economy would be capable of tolerating the pressure. Putin emphasized that curbing Russian oil supplies would destabilize world markets, pushing prices to levels that would be inconvenient for large economies. "This is a clear attempt to put pressure on Russia," Putin said. "But no country with honor accepts decisions imposed on it under duress.".
In response to renewed demands from Kyiv for high-quality Western arms, Putin warned that any incursions going deep into Russian territory would draw a "severe, potentially overwhelming" reaction from Moscow.
Trump, addressing journalists, explained that his meeting with Putin had been cancelled, and that he was not sure if it would be productive. Nevertheless, he suggested there could be dialogue at some future time. Putin accepted the news as a delay rather than a cancellation, and noted that diplomatic negotiations are not out of the question. The White House later clarified that there has not yet been a writing off of discussions, but that any future meeting would depend on its strategic value to the U.S. administration.
By WPB
Petroleum, Oil, Crude
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