Washington — President Joe Biden threatened to impose devastating sanctions on Russia if leader Vladimir Putin invaded Ukraine, but some large corporations and groups of companies should be wary of White House and lawmakers Is urging.
Industry groups representing Chevron, General Electric, and other large US companies operating in Russia are considering the White House to consider exempt products as companies fulfill their commitments and impose sanctions. I’m asking you to. At the same time, major energy companies are asking Congress to limit its scope and time frame.
The Biden administration and Congress “need to get the details right in case they have to obey the threat of sanctions,” President Jake Corbin of the National Foreign Trade Council told Reuters Monday.
“These details include consideration of safe harbors or winddown periods to enable companies to fulfill their existing contracts and obligations, as well as life-saving drug carve-outs and other humanitarian policies that are consistent with long-standing US policy. We need to include considerations, “says Corbin.
Energy companies have also contacted U.S. lawmakers directly to impose a “cool-down” or “wind-down” period to prevent assets from being seized if business contracts cannot be fulfilled in Russia, Congressional assistants said. The official told Reuters.
The American Petroleum Institute, the lobbying organization for the largest oil and gas drillers in the United States, has discussed sanctions against Russia with Congressional offices. “Sanctions should be as targeted as possible to limit the potential harm to the competitiveness of US companies,” said an API spokeswoman.
Former U.S. Department of Commerce official William Rheinsch said export sanctions would normally be introduced in stages, giving companies time to shrink existing businesses or ensure deliveries arrive.
However, in this case, sanctions are likely to be applied suddenly during the crisis, making it more difficult to secure a “winddown” period, he said.
In the past, the U.S. Treasury has provided some mitigation measures for economic sanctions, including licensing to protect senders of humanitarian aid and the flow of personal remittances to Afghanistan despite sanctions against the ruling Taliban. ..
U.S. Treasury officials declined to comment on such measures regarding potential sanctions against Russia, but “we are prepared to provide severe costs to the Russian economy while minimizing unwanted spillover. There is. “
Crimea sanctions legacy
Oil companies have felt the aftermath of US sanctions on some of Russia’s more expensive drilling operations for years after Putin invaded Crimea in 2014.
With this measure, ExxonMobil was expelled from Russia’s Arctic, terminated its partnership with Russian state-owned oil company Rosneft, and signed a $ 3.2 billion contract in 2011 to develop the region.
Exxon claims sanctions that delay the work of major discoveries in the Kara Sea above the Arctic Circle, imposes unfair penalties on U.S. companies, and domestically, one of the world’s largest oil producers. Allowed the operation of foreign companies.
Sanctions in 2014 achieved the simplest goals for Russia’s high-tech exploration oil and gas projects in the Arctic, Siberian shale, and deep sea.
New sanctions can be broader, but they can also be difficult to withdraw without harming Western companies.
According to Reinsch, one of the possible “safe harbor” measures could protect a company from liability for sanctions breaches if certain conditions are met.
Exxon did not immediately respond to a request for comment on lobbying for possible Russian sanctions.
A spokesman for the US Chamber of Commerce, the largest lobbying group for American companies, declined to comment on this topic.
According to the US Trade Representative’s office, US trade in goods and services with Russia is estimated to total $ 34.9 billion in 2019.
Andrea Sharal and Timothy Gardner