Name: What's in a US Senate draft bill to impose stiff sanctions on Russia and its trading partners?
Uploaded: 2025-06-17T17:32:10.000Z
Duration: 19 min 49 s
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Russia is continuing its war against Ukraine.

U.S. President Donald Trump has threatened to impose harder sanctions, but seems to be waiting.

In the Senate, there is a draft bill to impose secondary sanctions on Russian energy exports – 500 percent tariffs on countries importing oil, gas, petroleum, and uranium.

Our guest is Edward Fishman, a senior research scholar at Columbia University's Center on Global Energy Policy.

He served as Russia and Europe sanctions lead and as a member of the policy planning staff at the U.S. Department of State during the Obama administration.

To begin with, why do you think is Donald Trump so reluctant to impose harder sanctions against Russia?

For some reason, Donald Trump has decided that more sanctions on Russia is going to stop Putin from being serious about negotiations.

The thing that I highlight in my foreign affairs article that came out recently is that this is very different from Trump's approach to really every other country.

When it comes to China, he's shown no compunction about imposing tariffs on China at the same time as he's negotiating a trade deal.

With respect to Iran, he's been imposing significant sanctions on Iran at the same time that he's pursuing a nuclear deal.

So in virtually every other instance, Trump believes that coercion and diplomacy are compatible.

But for some reason, with respect to Russia, he considers them mutually exclusive.

And I think that that policy so far has not yielded very many results.

So hopefully he's about to change course.

Let's take a deep dive into your article on the foreign policy that you've just mentioned.

So you are arguing that Donald Trump should learn from the Obama administration.

Well, we shall not discuss that he actually doesn't like the Democrats and is very unlikely to take an example from Obama or Biden.

But anyway, your idea is take Iran sanctions as an example.

So I think there are interesting parallels between the situation with respect to Russia's sanctions today and the situation on Iran sanctions in the first year of Obama's presidency.

Similar to Trump today, Obama, when he came into the White House in 2009, wanted to reach out a hand to Iran, a bitter adversary.

But very few people in the American political spectrum believe that Obama's diplomacy would work.

He spent about the first six to 12 months of his presidency pursuing negotiations with

When those negotiations failed, a bipartisan supermajority in Congress, so both Republicans and Democrats, including Obama's own allies, teamed up to pass tougher and tougher sanctions against Iran over the next several years.

These sanctions were really important because they really created a serious threat of secondary sanctions.

They made it very clear to banks around the world that if they were transacting with Iran, that they would face cutoff from the U.S. financial system.

The most important of these sanctions, though, Roman, come in 2011, at the very end of the year, when Congress passes a law that imposes secondary sanctions on anyone that's transacting with the central bank of Iran, paying Iran basically for its oil sales, with the exception that if you reduce your purchases of Iranian oil every six months and only pay money into escrow accounts that can be used for humanitarian trade, then you have an exception from the sanctions.

And this was the critical sanction because it drove down Iran's oil sales by about 60% in 18 months, and it locks up almost $100 billion of Iran's oil revenues in overseas escrow accounts.

So what's your suggestion for the Russia sanctions?

Because as far as I understand, you don't believe that that bill, as we know it, will ever be implemented.

It seems too hard, or it would have too hard an effect on the world economy.

Yeah, look, I think the Graham-Blumenthal bill is a very welcome enterprise.

I think the congressmen are doing the right thing in terms of putting pressure on the administration.

But as written, the bill will never be implemented because what it threatens is 500% tariffs on any country that's buying any energy from Russia at all.

So that would mean that China or India or the European Union, which is still buying liquefied natural gas from Russia, or Japan, which is still buying energy from Russia, would face 500% tariffs by the US if they continued.

And to me, that threat is just not credible because we already saw Trump couldn't even sustain 145% tariffs on China for even a few weeks.

So the idea that he's going to impose 500% tariffs on all these countries just doesn't strike me as plausible.

So I think if this bill were to be passed as written, the likeliest outcome is that

Trump would simply invoke a national security waiver and not implement that part of the bill.

So what I think is urgent right now is I think it's important for the Trump administration to come to the table with Congress and negotiate something that is more practical and that actually could build significant leverage over Putin.

I think you've got to go back and look at that really successful Iran example from 2011 and 2012.

Just like Russia today, Iran at the time was a major oil exporter.

They're selling two and a half million barrels of oil on international markets each day.

And similar to today, there were real fears in Washington that imposing sanctions on Iranian oil could cut oil supplies to the market and lead to a spike in prices and maybe even worsen inflation.

That has been why, for instance, Joe Biden was so reluctant to impose oil sanctions on

What the Iran sanctions did, though, were so intelligent about them.

One is they didn't tell countries that they had to stop buying Iranian oil completely overnight.

They said, you just have to bring down your purchases.

And so what this did is it created sort of a glide path in which countries like China and India and Turkey, the same countries right now buying Russian oil, could reduce their purchases of Iranian oil every six months.

And it sent a signal to other market participants, like shale producers in the United States, to pump more oil to keep the market balanced.

And then the second part of it, Roman, was that it said that you could only pay for Iranian oil if it goes into these escrow accounts that could only be used for humanitarian transactions.

This could easily be applied right now to China, where you could tell Chinese banks that if they're going to pay for Russian oil, they have to pay into a Russian bank account in China, and that the funds can only be released to buy consumer goods from China.

They can't be released to buy drones or military equipment or any other components that could be used for Putin's war machine.

Let's imagine that your suggestion will be implemented.

So there will be sanctions, and countries buying Russian energy products will have to reduce the amount, and it will be reviewed every six months.

And then the revenues will stay in those countries.

The money will stay, but Russia can buy some goods there, like medical supplies or food or whatever.

How do you think China will react, since you've mentioned China?

China is a major buyer of Russian oil and other Russian energy products.

But also Europe, because Europe is still buying Russian LNG gas.

Yeah, I think both China and Europe would comply.

Europe is obviously the easier case, because the Europeans already have a goal of cutting themselves off from Russian energy entirely by 2027.

So in some ways, all this regime would do is just give them a further incentive to hit their goals.

China, of course, is the hardest part of this puzzle, because the Chinese are not at all party to the sanctions regime.

What I will note is the same was true for the Iran sanctions in 2011-2012, and the Chinese did comply.

And I think there are two reasons for that.

The first is there's a real threat of secondary sanctions.

If Congress is coming and saying that you will be sanctioned unless you comply with these terms, these big Chinese banks actually will have to cut off from the dollar and cut off from the US financial system if they don't comply.

And Chinese banks historically have shown very, very serious caution about violating

Even today, China relies on the dollar for 70% of its cross-border payments externally.

So China is still heavily dependent on the dollar.

The second reason, though, that I think is just as important is Chinese companies would actually have a positive incentive to comply.

They would actually not just be a stick, but also a carrot.

Because if you think about it, if payments for Russian oil have to stay in China, they can't go anywhere else, that means that every single dollar that Chinese refineries are paying for Russian oil has to be recycled into the Chinese economy.

It has to be used by Russia to buy imports from China.

So the Chinese will like this, because if anything, it will actually wind up boosting

And by the way, the same logic applies to India and Turkey as well.

Do you think that the risks are manageable because the Russian share of oil on the world market is greater than that of Iran?

I don't want to by any means suggest that this will be easy.

Russia is producing more than twice the amount of oil today than Iran was in the period that

But what I would note today is that back then, oil prices were well above $100 a barrel.

We had an incredibly tight oil market in 2011, 2012.

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What's in a US Senate draft bill to impose stiff sanctions on Russia and its trading partners?

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