U.S. lawmakers are turning up the pressure on President Joe Biden to follow Canada’s lead in banning Russian oil imports and hiking tariffs on other goods to punish Vladimir Putin for his invasion of Ukraine.
But the White House is resisting the measures for fear of further increasing the price of gas in the face of high inflation.
A bipartisan group of legislators announced on Monday that they would soon present a bill that would impose an embargo on Russian oil, suspend normal trade relations with Russia and press the World Trade Organization to freeze’s Russia’s membership. These measures would also apply to Russian ally Belarus, which has allowed Mr. Putin to use its territory as a staging ground for the attack on Ukraine.
The proposed legislation mirrors a move by Prime Minister Justin Trudeau last week. In addition to blocking Russian oil, Mr. Trudeau stripped Russia and Belarus of “most favoured nation” trading status, hiking tariffs on most of their exports to 35 per cent.
Russia supplies less than 2 per cent of Canada’s crude oil imports, and about 3 per cent for the United States. The U.S. imports some other significant goods from Russia, such as fertilizer and platinum.
In a statement, the top Democratic and Republican lawmakers in charge of fiscal policy – congressmen Richard Neal and Kevin Brady, and senators Ron Wyden and Mike Crapo – said their legislation “will send a clear message to Putin that his war is unacceptable.”
Their bill would, on top of the oil embargo, give Mr. Biden the ability to hike tariffs on other Russian imports, and oblige U.S. trade officials to press the WTO to suspend Russia.
House Speaker Nancy Pelosi is backing the legislation. “The United States remains ironclad in our commitment to the Ukrainian people and in unity with our allies,” she wrote in a letter to the Democratic caucus.
Mr. Biden and the leaders of other NATO countries have imposed unprecedented sanctions on Russia, targeting its financial sector, central bank and ability to import high-tech products. But the President faces calls to do more. Revenues from oil and gas provide nearly half of the Kremlin’s budget.
White House press secretary Jen Psaki said on Monday that Mr. Biden “hasn’t made a decision” on whether he would sign the oil embargo and tariff legislation if it passes. She said he was “taking all actions necessary to limit prices at the gas pump.”
Mr. Biden will not revisit his decision to cancel the Keystone XL pipeline from Canada in his attempts to hold down oil prices, she said.
“The oil is continuing to flow in, just through other means. So it would have nothing to do with the current price imbalance,” Ms. Psaki said.
Stopping Russian oil and gas shipments has become a litmus test of countries’ willingness to absorb financial pain in their support of Ukraine. Germany and other European Union countries are heavily dependent: Russia accounts for about a third of their oil imports.
In a video message on Monday, Ukrainian President Volodymyr Zelensky called on other countries to stop trading with Russia. “We have to lose fear and forget about commerce,” he said.
Maria Snegovaya, a political scientist who has studied how Russia’s oil revenues affect its foreign policy decisions, said targeting the Russian economy could starve Mr. Putin of the resources he needs to conquer Ukraine.
“Sanctioning oil and gas is the most important thing we can do,” said Ms. Snegovaya, a fellow at the Center for a New American Security, a Washington-based think tank.
Simon Lester, a trade analyst and former WTO official, said hiking tariffs on Russian goods would be less significant than other sanctions, such as cutting Russian banks out of the SWIFT system for processing international financial transactions. But every move is part of the steady increase in pressure on the Kremlin, he said.
“It’s part of an effort to co-ordinate among a number of countries,” he said. “If the U.S. can come along and then the EU, it all starts to add up.”
World leaders on Monday played down the likelihood that European countries would impose an oil embargo any time soon. “You can’t simply close the use of oil and gas overnight, even from Russia,” British Prime Minister Boris Johnson said in London after meeting with Mr. Trudeau and the Netherlands’ Mark Rutte.
In Bucharest, Foreign Affairs Minister Mélanie Joly said Canada needs to be part of any “form of plan to support Europe’s energy,” but stopped short of committing Canada’s abundant hydrocarbon resources to backstop Europe, citing export issues.
With reports from Marieke Walsh in London and Nathan VanderKlippe in Bucharest
Our Morning Update and Evening Update newsletters are written by Globe editors, giving you a concise summary of the day’s most important headlines. Sign up today.