A bipartisan Senate deal would let President Donald Trump tariff the largest buyers of Russian energy and extend Iran sanctions authority through 2031. A procedural vote is scheduled for late Tuesday, the same day Trump hosts Ukrainian President Volodymyr Zelenskyy at the White House. Even if the Senate passes the bill this week, it cannot become law before September.
A bipartisan group of senators announced a deal Tuesday on legislation that would allow President Donald Trump to impose additional restrictions on major buyers of Russian energy and Iran. Trump has signaled support for the measure, which was championed by the late Senator Lindsey Graham, and a procedural vote is scheduled for late Tuesday.
Tariff powers aimed at Russia's energy buyers
The text released Tuesday empowers the president to impose tariffs on the top five buyers of Russian crude and natural gas, as well as the top five countries helping Russia evade energy sanctions. It also allows a blanket tariff of 500% on Russian goods imported to the US, plus an additional 100% tariff on the top five energy importers and countries that import Russian crude oil or natural gas, or that facilitate sanctions evasion.
A last-minute change this week limits the new tariff authority to five years. Some Democratic lawmakers oppose the bill, warning Trump could use it as legal justification for broad new tariffs.
Iran Sanctions Act extended to 2031
On the Iran side, the legislation extends the Iran Sanctions Act of 1996 through 2031, preventing a potential lapse in authority. That law imposes secondary economic sanctions on non-US companies doing business with Iran and was set to expire this year.
Meanwhile, Brent crude, the global oil benchmark, fell on Tuesday, extending a sharp decline earlier this week. Bloomberg News reported that negotiators from Iran and Oman are attempting to forge an agreement to restart shipping through the Strait of Hormuz, a vital waterway virtually shuttered by Tehran for months.
The White House has previously imposed sanctions on Russia but granted temporary waivers for oil sales after the closing of the Strait of Hormuz during the war with Iran triggered a global oil market squeeze. Those waivers expired last month.
Zelenskyy arrives as two wars converge
Trump is scheduled to meet Zelenskyy at the White House Tuesday, and the Ukrainian leader will meet legislators at the Capitol later in the day. According to CNBC, Zelenskyy is looking to shore up support for Kyiv at a time when the Russia and Iran conflicts have shown signs of converging. Kyiv on Saturday launched an attack on an Iranian commercial vessel in the Caspian Sea, an incident Tehran said left one sailor dead and injured several others, and the Islamic Republic has threatened retaliation.
The bill has a strong chance of passing the Senate this week. But the House has left for its August recess, meaning the measure would not become law until September at the earliest.
Sources: Investing.com, CNBC, Investing.com
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