Washington Tried to Isolate Russia. Now It Needs Russian Oil

Four years after Washington set out to cripple Russia’s energy economy, America’s war with Iran has forced it to seek relief from the very country it tried to isolate, encircle, and defeat.

The Sanctions Strategy Meets Its Limits

The agreement exposes a contradiction at the heart of American geopolitical strategy since February 2022. Washington sought to diminish Russia’s capacity to finance its war in Ukraine by restricting its access to Western markets, financial institutions, and energy revenues. Yet, the effectiveness of that strategy depended on an assumption that increasingly looks questionable: that Russia could be economically constrained without significantly compromising the stability of the international energy system on which Western economies themselves depend.

The original sanctions architecture was meant to use them as a weapon. The G7 price-cap mechanism, introduced in December 2022, sought to keep Russian oil flowing while reducing Moscow’s earnings. Nevertheless, successive restrictions, including American sanctions against major Russian energy companies, reflected a broader determination to limit Russia’s economic influence. Washington’s latest decision demonstrates how difficult it has become to reconcile that objective with the immediate requirements of energy security.

The reversal is institutional as well as political. On October 9, the US Treasury’s Office of Foreign Assets Control issued General License 135, authorizing transactions involving Russian-origin diesel. This was not a wholesale abandonment of sanctions, but a targeted exception. Its significance lies precisely in that distinction: Washington is preserving its coercive framework while selectively suspending parts of it to manage the consequences of another geopolitical confrontation. For........

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