Wednesday

07-16-2025 Vol 2023

Trump Threatens Sanctions on Russia Over Ukraine Peace Deal

President Donald Trump has issued a stern warning to Russia, threatening to impose severe trading restrictions unless a peace agreement regarding Ukraine is reached within the next 50 days.

This announcement came during an event at the White House, where Trump revealed a collaborative agreement with NATO allies to supply additional weapons to Ukraine.

The shift in U.S. foreign policy is notable, particularly given Trump’s previous announcement just weeks earlier that indicated a pause in arms sales to Kyiv, marking a definitive change in his stance on the conflict.

In recent statements, Trump expressed growing frustration with Russian President Vladimir Putin, emphasizing his belief that a combination of tariffs, sanctions, and the introduction of advanced air defense systems, such as Patriot missiles, could potentially bring an end to Russia’s invasion of Ukraine, which has lasted over three years.

Ukrainian President Volodymyr Zelenskyy responded positively to Trump’s remarks, thanking him via Telegram for his support in efforts to halt violence and strive for a lasting peace.

In a press conference with NATO Secretary-General Mark Rutte at his side, Trump did not hold back his disappointment in Putin’s actions, declaring that billions of dollars in U.S. military aid would be directed to Ukraine as part of this new policy approach.

Trump’s recent remarks come in the context of heightened Russian attacks on Ukrainian cities, including a barrage of drone strikes that have intensified in recent days.

Expressing indignation over Russia’s military actions, Trump reflected on his previously amicable conversations with Putin, stating, “My conversations with him are always very pleasant… and then the missiles go off at night.”

He promised the delivery of top-quality weapons to NATO countries, clarifying that NATO would be responsible for financing these transactions.

Mark Rutte added that several nations, including Canada, Denmark, Finland, Germany, Sweden, the Netherlands, and Norway, are interested in participating in the weapons arrangement.

Additionally, Trump warned of impending severe tariffs on Russian goods if negotiations do not yield results within the specified 50-day timeframe.

He elaborated that proposed tariffs could be as high as 100 percent on Russian exports, and he also threatened to implement secondary tariffs, targeting nations that engage in trade with Russia.

The concept of secondary sanctions represents a significant escalation in U.S. measures against Russia, particularly as past sanctions have primarily focused on individuals rather than addressing the broader economic framework.

Since Russia’s invasion of Ukraine in February 2022, Western nations have imposed nearly 22,000 sanctions against various Russian entities, with crucial measures such as import bans on Russian oil and gas, price caps on Russian fuel, and freezing of assets by the Russian central bank held abroad.

The possibility of secondary sanctions would mark a pivotal turn in how the U.S. handles trade relations with nations linking themselves to Russia’s economy.

Despite ongoing sanctions, G7 member states have traditionally refrained from restricting Russia’s ability to sell its fossil fuels, especially to major buyers like China and India.

Current legislative efforts in the U.S. include a bipartisan bill called the Sanctioning Russia Act of 2025, which aims to impose stringent tariffs on countries purchasing Russian energy products.

If passed, this bill would authorize Trump to impose tariffs of up to 500 percent on nations that continue to engage in trade with Russia, pending his approval for further legislative action.

Furthermore, Trump has the option of enacting secondary tariffs through the International Emergency Economic Powers Act, which allows him to impose trade restrictions during a national emergency.

Meanwhile, within the European Union, progress is being made toward a new sanctions package against Russia, with the bloc’s foreign policy chief, Kaja Kallas, indicating that discussions are ongoing among the 27 EU nations.

Kallas expressed hope for a political agreement regarding the 18th round of sanctions package to be reached soon.

Despite the array of sanctions already imposed, Russia remains heavily reliant on revenue from fossil fuel exports.

Even as oil revenues saw a slight decline in 2024, they remained steady, largely thanks to Russia’s “shadow fleet,” which allows the country to circumvent Western sanctions by operating with ships that avoid Western financial systems.

From 2022 to 2025, China has purchased nearly half of Russia’s total crude oil exports, while India closely follows, accounting for approximately 40 percent of imports.

Both countries also engage in significant trade of Russian coal.

While the EU has reaffirmed its commitment to reducing reliance on Russian natural gas — aiming to terminate contracts by 2027 — it continues to consume considerable amounts of this resource.

In contrast, a change in U.S. tariffs on Russian exports is unlikely to have a substantial impact, as the total value of exports to the U.S. was just $3 billion in 2024, making up only 0.7 percent of Russia’s overall exports.

Despite a reduction in the proportion of gross domestic product (GDP) attributable to fossil fuels, Russia’s economy continues to rely heavily on energy exports, generating about 55 percent of export revenues and 16 percent of GDP, translating to around $280 billion.

This is only a slight decrease from pre-invasion figures, where fossil fuels constituted about 60 percent of Russia’s export revenues and 18 percent of GDP.

Experts anticipate that the consequences of Trump’s sanctions threat could potentially devastate Moscow’s economy, especially in the energy sector.

A significant reduction in energy exports due to secondary sanctions is likely to lead to a spike in global oil prices, particularly affecting natural gas.

Kieran Tompkins, a senior climate and commodities economist, forecasted that while the oil market could handle some disruption due to available spare capacity, the loss of half of Russia’s crude exports could diminish export revenues by around $75 billion.

This dramatic shift in revenue could spark a fiscal crisis in Russia, resulting in increased debt issuance, rising bond yields, and necessitating stringent fiscal controls.

As the 50-day ultimatum unfolds, Moscow is under pressure to formulate counterproposals, possibly delaying the imposition of sanctions.

Trump hopes that the looming threat of sanctions will push Putin towards a resolution to the ongoing conflict in Ukraine.

image source from:aljazeera

Abigail Harper