President Joe Biden announced a U.S. ban on all Russian oil, gas and energy imports Tuesday at a White House press conference and noted the decision is likely to drive already record-level consumer prices even higher.
“Today, I’m announcing the U.S. is targeting the main artery of Russia’s economy,” Biden said. “We’re banning all imports of Russian oil, gas and energy.
“The American people will deal another powerful blow to Putin’s war machine.”
Biden said international economic sanctions in response to Russia’s invasion of Ukraine are pummeling the Russian economy and have helped drive the value of the country’s currency, the ruble, down by 50%.
But Russian energy exports have not, until now, been targeted as a part of sanctions, thanks in large part to Europe’s heavy dependence on Russian energy imports. Biden noted the ban is, for the time being, a unilateral move by the U.S.
“We’re moving forward with this ban understanding that many of our European allies and partners may not be in a position to join us,” Biden said. “This is a step that we’re taking to inflict further pain on Putin, but there will be costs as well here in the U.S.”
Biden said he believes the ban has bipartisan support in Congress and among the American people.
Some members of Utah’s congressional delegation applauded the Biden ban but noted more needs to be done on development of domestic energy resources, including in Utah.
The decision is likely to drive further U.S. price increases at the consumer level. On Tuesday, AAA reported the average price of gas in the U.S. reached an all-time high of $4.17, surpassing the previous high of $4.11 set in 2008. The average price per gallon of gas in Utah was $4.01 on Tuesday, according to AAA.
Biden’s move follows pleas by Ukrainian President Volodymyr Zelenskyy to U.S. and Western officials to cut off the imports, which had been a glaring omission in the massive sanctions put in place on Russia over the invasion. Energy exports have kept a steady stream of cash flowing to Russia despite otherwise severe restrictions on its financial sector.
The U.S. will be acting alone, but in close consultation with European allies, who are more dependent on Russian energy supplies. The European Union this week will commit to phasing out its reliance on Russia for energy needs as soon as possible, but filling the void without crippling EU economies will likely take some time. Natural gas from Russia accounts for one-third of Europe’s consumption of the fossil fuel. The U.S. does not import Russian natural gas.
Biden also issued a warning to private sector industries that the current circumstances should not be used as an excuse for “excessive price increases” and said as Russia’s aggression is already “costing us all ... it’s not the time for profiteering or price gouging.”
The issue of oil sanctions has created a conflict for the president between political interests at home and efforts to impose costs on Russia. Though Russian oil makes up only a small part of U.S. imports, Biden has said he was reluctant to ban it, cutting into supplies here and pushing gasoline prices higher.
In a Tweet before Biden spoke Tuesday morning, Utah Republican Sen. Mike Lee said Biden needed to follow up the Russian import ban by expanding access to U.S. domestic energy resources.
“Now that @POTUS has finally consented to halting Russian oil imports, he must follow through with the logical second step and open the tap on America’s clean, abundant energy resources,” Lee tweeted.
Rep. John Curtis, R-Utah, called the ban of Russian oil a positive step but said the U.S. “must go even further.”
“It is time to choke Russia’s entire oil and gas industry and take steps to wean Europe off of its reliance on Russia,” he tweeted.
Banning Russian oil and #natgas from the U.S. is a positive step but we must go even further.— Rep. John Curtis (@RepJohnCurtis) March 8, 2022
It is time to choke Russia’s entire oil and gas industry and take steps to wean Europe off of its reliance on Russia.
More of my thoughts here: https://t.co/LDAtsHIXxo
Even before the U.S. ban many Western energy companies including ExxonMobil and BP moved to cut ties with Russia and limit imports. Shell, which purchased a shipment of Russian oil this weekend, apologized for the move on Tuesday amid international criticism and pledged to halt further purchases of Russian energy supplies. Preliminary data from the U.S. Energy Department shows imports of Russian crude dropped to zero in the last week in February.
Inflation is at a 40-year peak, fueled in large part by gas prices, and that could hurt Biden heading into the November midterm elections. He said two weeks ago that he wanted “to limit the pain the American people are feeling at the gas pump.”
U.S. consumers have been feeling plenty of cost-related pain of late and the national average prices for a broad range of goods and services have been on the rise for a month.
Apartment rental costs rose 0.5% in January, the fastest pace in 20 years. Electricity prices surged 4.2% in January alone, the sharpest rise in 15 years, and are up 10.7% from a year earlier. Last month, household furniture and supplies rose 1.6%, the largest one-month increase on record dating to 1967.
Food costs, driven by pricier eggs, cereal and dairy products, increased 0.9% in January. Air fares rose 2.3%. New car prices, which have jumped during the pandemic because of a shortage of computer chips, were unchanged last month but are up 12.2% from a year ago. The surge in new car prices has, in turn, accelerated used car prices; they rose 1.5% in January and are up a dizzying 41% from a year ago.
The U.S. imported 245 million barrels of oil from Russia last year — about 8% of all U.S. oil imports — up from 198 million barrels in 2020. That’s less than the U.S. gets from Canada or Mexico but more than it imported last year from Saudi Arabia.
Contributing: Associated Press