On March 8, President Biden banned oil imports from Russia to the U.S, the latest in a series of punishing sanctions in response to Russia’s unprovoked invasion of Ukraine. The ban encompasses oil, natural gas, and coal, which combined constitute about 40% of Russia’s federal budget revenues and 60% of its exports. The ban comes into conflict with European nations, who are far more reliant on Russian oil and are unable to ban Russian imports.
The Russian economy has already been suffering from severe sanctions imposed by the U.S and its allies. The Ruble has plummeted 39% this year and the Russian stock market plunged as well, erasing 60% of its value. However, the ban may have less severe effects. While Russia will miss the lost revenue from the U.S., without key European allies joining in, the efficacy will be reduced.
The effects of the ban will be two-fold. While it bruises the Russian economy, the ban will also be detrimental to the U.S economy. The decrease in supply of oil in the U.S resulting from the ban will drive gas prices even higher than they already are. Gas prices are already soaring due to general inflation and sanctions on Russia, and the ban will worsen the situation.
The higher gas prices and decreased oil supply could also potentially lead to a faster shift to renewable energy to replace the lost Russian imports, and eventually replace all fossil fuel energy sources. This would crush the Russian economy, which relies heavily on oil exports for revenue.
To sum up, the U.S ban on Russian oil imports will hurt the Russian economy, but its affects will be minimal as Europe cannot afford to ban Russian oil. Additionally, the ban will result in higher gas prices in the U.S, which, when added onto the already sky-high inflation, will make Americans less than happy.