US Likely to Hold Off for Now on Energy Sanctions for Russia, Fearing Impact on Global Prices

The Biden administration is drafting options for multiple rounds of harsh sanctions on Russia if it moves to invade Ukraine, but energy sanctions could be a last resort given the impact they could have on the global economy and domestic gasoline prices, three US officials tell CNN.

"We're trying to do it in such a way where it is a menu of options. We will not do everything on that menu all at once," one of the officials said. "The energy section of it is the more extreme option if it becomes necessary. I do not see that as being in the first tranche. You always want to keep things in your back pocket."

Some administration officials believe there is a clear correlation between President Joe Biden's approval ratings and the prices at the pump and don't want to rock the boat, the officials explained. But after this story was first published, the National Security Council said it won't factor in domestic political considerations when sanctions options are presented to Biden.

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As conversations continue about these sanctions packages, experts warn that avoiding hard-hitting measures targeting Russia's energy sector -- which could affect global oil markets and prices at the pump -- could mean the sanctions would not be strong enough to deter Putin. National security adviser Jake Sullivan has suggested the sanctions would be severe.

"It will be very difficult to impose severe economic harm on Russia without affecting energy markets," said Edward Fishman, a former State Department official who is now a senior fellow at the Atlantic Council. "Oil and gas account for 40 percent of Russia's federal budget. The United States and Europe can take steps in advance to contain spillovers, but if they plan to impose serious economic sanctions on Russia, they cannot avoid the energy sector entirely."

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