Western businesses pondering potential comeback to Russia
Going forward with Trump-Moscow talks, businesses are weighing their options amidst a potential shift in sanctions against Russia
The ongoing negotiations between the Trump administration and Russia's government has sparked hope within the business world, as some restrictions may ease, allowing for renewed cooperation with Russian partners. However, the EU and the UK have committed to maintaining these sanctions, causing a divisive issue for businesses.
According to Sam Teit, head of the regulatory and investigations department at legal firm Clyde & Co, this disagreement between the US and Europe on sanctions is a "major problem for business." Companies are now scrambling to prepare for potential changes to the sanctions regime.
Daniel Martin, partner and sanctions specialist at HFW, doubts the feasibility of the US completely lifting all sanctions against Russia. He added that it is essential to evaluate the current circumstances and understand the potential secrets that might unravel from the US's perspective. Martin also expressed the opinion that if sanctions are eased, oil traders would likely jump at the chance to resume cooperation with Russia faster than oil producers needing significant investments for this. Meanwhile, he warned, Western companies must consider the risk that the US may ease sanctions and then reimpose them.
Li Hansson, a lawyer at Reed Smith, believes that the easing of restrictions is more likely to be capitalized upon by Asian or Middle Eastern companies to expand their existing business in Russia.
On February 28, 2025, US President Donald Trump extended anti-Russian sanctions that were first imposed between 2014 and 2022 due to the Ukraine situation. The restrictions will remain in effect until March 6, 2026, as stated in the decree. In April, he also extended for one year the anti-Russian sanctions imposed by former President Joe Biden in 2021.
Despite this, Donald Trump did not rule out the possibility of the US lifting sanctions on Russia "at some point." In early March, Reuters reported, citing sources, that the White House was developing a plan to ease sanctions, possibly lifting restrictions on some physical and legal entities. Bloomberg referred to sanctions as a "bargaining chip" in Ukraine talks. EU authorities, however, emphasized that they have no intention of lifting sanctions on Russia until the conflict in Ukraine is resolved.
The Kremlin has consistently argued that sanctions are illegal and has repeatedly urged for their cancellation.
Businesses must stay vigilant and monitor ceasefire adherence, EU energy procurement policies, and intra-administration tensions to gauge potential midterm risks as the situation unfolds.
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- Daniel Martin, a sanctions specialist, questions the total lifting of sanctions against Russia, suggesting it is crucial to assess current circumstances and potential secrets that might unveil from the US's perspective.
- Martin also opines that if sanctions are eased, oil traders would probably be quicker to resume cooperation with Russia compared to oil producers needing substantial investments.
- Li Hansson, a lawyer at Reed Smith, anticipates that Asian or Middle Eastern companies are more likely to seize the opportunity to expand their existing business in Russia, should sanctions be eased.
- Despite the extension of anti-Russian sanctions, Donald Trump has not ruled out the possibility of the US lifting sanctions on Russia "at some point."
