(Bloomberg) — The Biden administration’s objections to banning oil imports from Russia puts it at odds with a bipartisan clamor to punish Moscow for the invasion of Ukraine despite the inevitable pain it would cause by soaring gasoline prices.
At about the same time another bipartisan bill was introduced to ban Russian energy imports, White House press secretary Jen Psaki warned that choking off the oil flow from Russia would have a global economic impact.
“Our objective and the president’s objective has been to maximize impact on Russia while minimizing impact to us and our allies and partners,” Psaki said at a briefing Thursday. “We don’t have a strategic interest in reducing the global supply of energy, and that would raise prices at the gas pump for the American people, around the world.”
That, she said, “is certainly a big factor for the president.”
Accelerating inflation has become a top issue for U.S. voters, dragging down President Joe Biden’s approval ratings ahead of midterm elections in which Democrats’ control of the House and Senate is at risk. Yet congressional Democrats, including House Speaker Nancy Pelosi, have joined with Republicans in calling for the U.S. to stop paying for Russian oil while the country’s tanks and troops roll across Ukraine.
Senators Joe Manchin, a West Virginia Democrat, and Lisa Murkowski, an Alaska Republican, offered the most recent bipartisan proposal. Their legislation would declare a national emergency during which no oil, gas, coal or other fossil fuel could be imported to the U.S. From Russia. The emergency would last at least as long as the invasion continues and could be lifted if there is a substantial change in Russian President Vladimir Putin’s position.
The administration’s position has been they “don’t want to put that on the table,” Murkowski said. “Well, I’m sorry sir, it’s on the table.”
“There should not be a single additional American dollar allowed to finance these atrocities,” she said.
Manchin and Murkowski represent energy producing states and they back stepping up oil production from domestic sources. But the sentiment for banning Russian imports also includes progressive Democrats such as Senators Ed Markey and Elizabeth Warren, both of Massachusetts. Markey introduced legislation Tuesday that would ban all imports of Russian crude oil and petroleum products.
“We’re looking for every possible way to strangle the Russian economy,” Warren said in an interview. “It’s a petro-based economy, so cutting off this source of revenue would make Putin hurt. I’m in favor of things that make Putin hurt.”
Unlike Manchin and Republicans, the progressives don’t want Biden to reverse his restrictions on domestic production and pipelines, and want to ramp up a transition away from a carbon-based economy.
Many Republicans have called on Biden this week to act to reopen oil and gas leasing on federal lands and offshore and to otherwise encourage domestic production. The administration and progressives like Markey note oil companies already sit on many leases they aren’t using and are free to drill more on their own.
There are some senators in both parties who aren’t yet on board with a ban. Mitt Romney of Utah wants to make sure doing so doesn’t simply hurt the United States and is coordinated with other countries, because Russia could sell their supplies elsewhere. And Chris Murphy of Connecticut has said while he’s looking at the issue, it’s very complicated and involves a global commodity.
The average retail price for regular gasoline in the U.S. is $3.728, according to AAA, up from $2.737 a year ago.
When including other petroleum products, like unfinished fuel oil that can be used as a feedstock to produce gasoline and diesel, Russia accounted for about 8% of the U.S.’s 2021 oil imports, though those shipments have also been trending lower in recent months.
Many U.S. refiners had been quietly shifting away from Russian imports even before war broke out. Monroe Energy LLC, the third largest U.S. importer of Russian crude, this week became the latest refiner to eschew oil from Russia, saying it wouldn’t enter into new supply deals “for the foreseeable future.”
