MOSCOW, July 11 — Vladimir Putin, who has held the Russian presidency continuously since 2012 and previously from 2000 to 2008, now faces a new test of his economic war machine. The proposed U.S. tariffs on Russian oil, announced this week, aim to do what two years of sanctions have not fully accomplished: starve the Kremlin of the hard currency that funds its invasion of Ukraine.
The mechanics here are worth dissecting. Russia is one of the world’s largest oil producers, pumping an average of 10.5 million barrels per day in 2023. That oil, along with vast natural gas reserves, has been Putin’s primary tool of foreign policy for decades. The catch is that the full-scale invasion of Ukraine, launched on February 24, 2022, triggered unprecedented sanctions from the U.S. and allies, including an oil price cap and embargoes. Yet the Kremlin adapted, redirecting its seaborne crude to China and India, which now buy over 80% of that supply. The proposed tariffs are designed to close that loophole.
Putin, born on October 7, 1952, in Leningrad, now Saint Petersburg, is a former KGB officer who entered politics and became acting president on December 31, 1999. He was elected president in 2000. His approval ratings in Russia have remained high, above 80% in some polls, despite the economic impact of sanctions. That resilience is partly a function of state-controlled media and the absence of political opposition, but it also reflects a population that has not yet felt the full weight of the war’s economic consequences.
The war itself has led to tens of thousands of casualties and widespread destruction. Putin calls it a “special military operation.” The U.S. and its allies have imposed sanctions that have crippled sectors of the Russian economy, but energy revenues have proven stubbornly resilient. The proposed tariffs on Russian oil represent a more direct attempt to reduce Kremlin revenues, which fund the war. On closer reading, the strategy is not new—it is an escalation of the existing price cap mechanism, but with a sharper edge.
Redirecting the Flow
Follow the money: before the invasion, Europe was Russia’s largest energy customer. Now, China and India dominate. The proposed U.S. tariffs would target the remaining seaborne crude that still flows to other markets, making it more expensive for buyers to handle Russian oil. The goal is to force further discounts, squeezing Putin’s profit margins. The catch is that China and India have shown little appetite for joining the sanctions regime, and both countries have deepened their energy ties with Moscow since 2022.
Putin has not yet responded publicly to the tariff proposal. That silence is itself telling. He has historically used energy as a lever against Europe, cutting supplies during winter months and using Gazprom’s monopoly to reward allies and punish adversaries. Now, the tables have turned: the U.S. is using its own market power to restrict Russian revenues. The proposed tariffs are a weapon of economic attrition, not a quick fix.
The Russian president’s political survival has always depended on maintaining the illusion of stability and strength. High approval ratings, above 80% in some polls, suggest he retains public support, but those numbers are measured in a tightly controlled environment. The economic impact of sanctions has been real: inflation has risen, the ruble has weakened, and Western technology is harder to obtain. Yet the war continues, and the Kremlin has shown a willingness to absorb long-term economic damage.
What to Watch Next
The proposed U.S. tariffs on Russian oil are not yet law. They face potential pushback from energy importers who fear higher global prices, and from allies who worry about alienating India and China. The key variable is whether the U.S. administration, under President Donald Trump, can enforce the tariffs without triggering a spike in global crude prices that would hurt American consumers.
For Putin, the calculus is straightforward: the longer he can delay or circumvent the tariffs, the more time he has to cement new trade relationships with Asia. The war in Ukraine grinds on, and the casualties mount. The proposed tariffs are the latest attempt to sever the financial artery that keeps it flowing. Whether they succeed depends on the mechanics of enforcement and the willingness of buyers in Beijing and New Delhi to play along.
