Here are the American companies calling on Biden to moderate Russia
Several American companies, especially those active in the energy sector, do not want too heavy sanctions against Russia, should it attack Ukraine. They fear economic damage and a recurrence of the conditions experienced in 2014. Here's why
The United States promises to respond harshly to any Russian attack on Ukraine, through the imposition of heavy economic and financial sanctions. However, a group that brings together several large American companies doing business in Russia, such as the Chevron oil company or the General Electric industrial group, is already lobbying the Joe Biden administration to get it to exempt some products from trade retaliation. In parallel, some major energy companies are trying to persuade Congress to limit the scope and duration of the sanctions.
DEFINE THE "RIGHT DETAILS" OF THE PENALTIES
Jake Colvin, president of the National Foreign Trade Council, a trade group that aims to promote American exports, told Reuters that the White House and Congress must work out the "right details" in the event of sanctions on Russia, taking into account the establishment of exemption periods that allow companies to comply with the contractual obligations to which they are bound.
WHAT THE LOBBY OF PETROLEUMERS WANT
A congressional official told the agency instead that energy companies want less harsh sanctions against Moscow to avoid having their properties confiscated in the country.
The American Petroleum Institute, the main lobby of American hydrocarbon producers, discussed sanctions on Russia with congressmen and said that the sanctions should be "as targeted as possible to limit the possible damage to the competitiveness of US companies".
GRADUALITY OR IMMEDIATENESS?
William Reinsch, a former US Department of Commerce official, explained that export sanctions are usually phased in gradually to give companies time to adapt. However, should Russia invade Ukraine, they would be introduced immediately, thus complicating the adaptation of industrialists to the new trade regime.
THE EXAMPLE OF POST-CRIMEA
Oil companies, in particular, fear a recurrence of the conditions already experienced following the sanctions imposed by Washington against Moscow after the invasion of Crimea, Ukrainian territory, in 2014. And they say that, due to those measures, drilling operations in Russia they have been more expensive for years. ExxonMobil, for example, had to give up its activities in the Russian Arctic by ending its collaboration with Rosneft (the Russian state-owned oil company), with which it signed a $ 3.2 billion deal in 2011.
Exxon's line is that the sanctions ended up penalizing American companies against foreign ones active in Russia, because they caused a slowdown in work on fields in the Kara Sea, above the Arctic Circle. The sanctions of 2014 – Reuters reconstructs – in fact hit Russian oil & gas projects in the Arctic, in shale deposits in Siberia and in deep waters. The new and possible sanctions could be even more extensive.
HOW MUCH THE UNITED STATES-RUSSIAN TRADE IS WORTH
In 2019, according to American data, the trade in goods and services between the United States and Russia amounted to 34.9 billion dollars. For comparison, US exports of goods and services to China alone exceeded $ 160 billion in the same year.
However, it should be noted that Russia is the second largest supplier of refined petroleum products to the United States.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/energia/stati-uniti-sanzioni-russia-aziende/ on Thu, 27 Jan 2022 09:36:54 +0000.