US Prepares Sanctions as Peace Talks Intensify: A Carrot-and-Stick Approach

The US administration is considering expanding energy sanctions against Russia, presenting a tough choice: agree to a peace deal for Ukraine or face economic hardship. Outlets like Bloomberg report these actions serve as the stick in a plan to push Vladimir Putin to negotiate.

Targeting Russia’s Energy Sector

The proposed sanctions aim to severely impact the Russian energy sector. Sources say Treasury Secretary Scott Bessent discussed these plans with European ambassadors. The focus might be on Russia’s shadow fleet—older tankers used to avoid current price limits—and the international traders involved in these transactions.

Kremlin spokesperson Dmitry Peskov acknowledged these discussions but cautioned that such actions make normalizing relations harder. Market reaction was immediate; Brent crude prices rose briefly after the news, due to concerns about a tighter global supply if these actions are implemented.

Diplomatic Progress and Remaining Issues

This occurs at a crucial time. US envoy Steve Witkoff and other negotiators just finished talks in Berlin with Ukrainian and European leaders. Progress was reported about US security promises for Kyiv, but reaching an agreement is still complex.

Key disagreements exist:

• Territorial Issues: Russia still wants control of the Donbas region, while US proposals suggest demilitarized or free economic zones under special administration.

• Security Promises: President Zelenskyy wants legally binding promises, possibly approved by the US Congress, to prevent further Russian attacks.

• Frozen Assets: The status of Russian central bank assets is a key negotiating point, with European leaders debating using these funds for Ukrainian aid.

Congressional Involvement

The White House says no final decisions have been made, but Congress is involved. A bipartisan group of senators introduced a bill targeting third-party buyers of Russian oil. The bill's success depends on White House support, but it shows that Washington wants to keep pressure on Moscow.

A Key Moment for Peace

The current plan seems to be peace through pressure. By readying new economic limits while also engaging in talks—including high-level meetings at the Kremlin with Witkoff and Jared Kushner—the administration seeks to alter Putin’s calculations.

Russian Deputy Foreign Minister Sergei Ryabkov expressed confidence that the war is ending soon. The world is waiting to see if the risk of economic isolation will outweigh Russia's territorial goals. Washington's message is now clear: there is an opportunity for a settlement, but rejecting it will be costly.