U.S. sanctions against Russia: this is only beginning
global.espreso.tv
Mon, 03 Nov 2025 17:38:00 +0200

Entities that continue to cooperate with sanctioned companies risk losing access to Western banking systems and dollar settlements.The consequences of the sanctions, which were finally imposed by the U.S., are already beginning to accumulate.Let's consider the main news, which sounds quite optimistic for us:1. The parties, of course, are still announcing victorious theses.Trump noted that India will not buy Russian oil, and China will buy "significantly less."In response, there is traditional Russian bravado about "miraculous sanctions," "it won't hurt," and "it's worse for you."And China was outraged and even promised to buy more Russian oil.2. But promising is one thing, and falling under secondary sanctions just to please Putin is unlikely.At least for now, Chinese state-owned companies (PetroChina, Sinopec, CNOOC, and Zhenhua Oil) have suspended purchases of Russian oil. Officially – temporarily.And Chinese companies associated with Russian oil were included in the list of the 19th package of EU sanctions. Fighting both the EU and the U.S. at once is expensive even for the Celestial Empire.Although China will still buy Russian oil through pipelines and independent oil traders, Russia will not have the same profit as before."Sanctioned Rosneft and Lukoil account for about 25% of China's oil imports from Russia."3. Moreover, India, the largest importer of Russian oil, has also reduced purchases to avoid violating sanctions. According to Kpler, this year Russia supplied over 36% of India's oil imports, becoming its largest supplier since 2023. Indian refinery executives said that the new restrictions make it impossible to continue contracts with Russian suppliers.In particular, the Indian company Reliance Industries Ltd, which is the largest buyer of Russian oil in the country (about 500 thousand barrels of oil per day from Rosneft), announced its intention to comply with Western sanctions against Moscow.Orders for November-December are now expected mainly from alternative sources, primarily from Middle Eastern countries.The only exception may remain Nayara Energy, which is owned by Russia's Rosneft and operates exclusively on Russian oil after EU sanctions. However, even its further activities are under threat.India will be able to get rid of Russian oil imports faster than China, as it previously did not have a deep dependence on Russian supplies.4. Finally, the Organization of the Petroleum Exporting Countries (OPEC) announced its readiness to increase production in case of a market deficit caused by U.S. sanctions against Russian oil giants Rosneft and Lukoil. This was announced by Kuwaiti Oil Minister Tariq Al-Rumi. Amid news of the refusal of major Indian refineries and Chinese state-owned companies to buy Russian oil, prices for the benchmark Brent crude jumped by 5.6% to $66.03 per barrel."Thus, sanctions against Russia open up additional opportunities for OPEC members, while depriving Moscow of key sales markets that previously helped it finance the war against Ukraine."5. And new blows are ahead.The U.S. Senate has intensified work on a large-scale sanctions bill. The co-authors of the initiative – Senators Lindsey Graham and Richard Blumenthal – propose:Imposing high tariffs on imports of Russian oil and gas;Introducing secondary sanctions against companies that help Russia in energy production.Graham emphasized that "Congress must continue to pressure Moscow" and proposed holding a "Russia week" in the Senate – a series of votes on decisions related to the war in Ukraine.Senators are also considering initiatives to use frozen Russian assets to help Ukraine and recognize Russia as a state sponsor of terrorism. "Now there is no excuse for delay," said Senator Blumenthal.Majority Leader John Thune said the Senate is working in coordination with the White House, and a vote could take place within a month.6. All this news is adequately assessed by the market.In just two days, the market capitalization of the two largest Russian oil giants decreased by 424 billion rubles, which is equivalent to about $5.2 billion.The two companies provide about half of Russia's oil exports – more than 2.2 million barrels per day. Together with Surgutneftegaz and Gazprom Neft, which are already under U.S. sanctions, up to 70% of all Russian oil exports fall under restrictions.7. To minimize the consequences, the Kremlin plans to involve a shadow fleet of tankers and a network of intermediary oil traders. The Russian government has approximately one month until the restrictions fully enter into force, during which it will try to rebuild logistics."Even a 5-10% reduction in exports combined with an expansion of discounts on Russian oil could cost Russia up to 120 billion rubles monthly – about 20% of planned oil revenues."8. As a result of all these processes, even officially, the Russian economy is on the verge of recession.Production in civilian industries is falling particularly sharply, where the volume of output decreased by 5.4% in eight months – and in annual terms could reach 6.3%.Moreover, production has already begun to decline at military factories. After three years of double-digit growth, industries related to the military-industrial complex have moved to stagnation or even production cuts, according to Rosstat data:Production of finished metal products in September 2025 decreased by 1.6% year-on-year;The output of "other vehicles" – a category that includes tanks and armored vehicles – fell even more sharply. According to Raiffeisenbank estimates, in monthly terms, the industry collapsed to minus 6%. MMI analysts note that now military production is pulling down the overall index of manufacturing industries, which grew by only 0.4% against 2.4% in August.The machine-building sector, dependent on state orders, decreased by 0.1% in September after an August jump of 15.7%.9. Those who will be laid off from stagnating industries will find it difficult to find work.One-third of Russia's 6.35 million small businesses may cease operations due to the "tax reform" (more simply, tax increases), which will come into force in 2026.10. In the harsh world of the right of force, into which the Kremlin is so persistently dragging the planet, weaklings are not liked. Missed a blow – it's your own fault, deal with the consequences. And friends will help... drown deeper.We must not relax and in no case slow down the pace of strikes against Russia.SourceAbout the author. Rostyslav Pavlenko, Ukrainian politician, political scientist, political technologist, lecturer.The editorial board does not always share the opinions expressed by blog authors.







