What is left in the US sanctions arsenal, and will Donald Trump pull the trigger?

Memphis Barker Senior Foreign Correspondent

14 May 2025 10:16pm BST

What would it mean for Russia, if the United States really did launch “harder” sanctions“than we’ve ever seen before” against its economy?

That was the threat issued by Lt Gen Keith Kellogg, the US special envoy to Ukraine, in an interview with Fox News on Tuesday.

Lt Gen Kellogg said Vladimir Putin had been warned that drastic new US sanctions were ready to go, should he come to be seen as the main obstacle to peace.

European leaders would act in tandem with the president, he said, having had a “good phone call” on the subject last week.

It remains the overwhelming likelihood that, come the talks in Istanbul on Thursday, Putin fails to engage in anything but prevarication. He is not expected to attend in person.

Volodymyr Zelensky therefore has the chance to further convince Washington that Russia – not Ukraine – is to blame for the continuation of the war.

The point will be easy to convey if he meets an empty chair instead of Putin, the only person he has agreed to talk to on the Russian side.

It begs the question: what is left in the US sanctions arsenal, and will Donald Trump pull the trigger?

Russia’s war effort is funded by fossil fuel exports. Since the war began, Moscow has earned £760 billion from oil, gas and coal sales, according to the Centre for Energy and Clean Air (Crea), a Helsinki-based think tank.

That is more than double the £300 billion given and promised to Ukraine so far across Europe and the United States. It is seven times what Russia spent on its military last year.

Western efforts to cut off this source of funding have had an impact at the fringes, though Russia has adapted with comparative ease.

Moscow has foregone £106 billion in oil revenue thanks to existing sanctions, according to data up to January 2025 from the KSE Institute, a branch of the Kyiv School of Economics.

European nations including Hungary and Slovakia will not voluntarily slash the £18.5 billion they spent on Russian energy in 2024, with few leaders willing to take the economic hit and political instability that would follow.

But with US leadership, Russia’s fuel export business could effectively be crippled.

“The idea that we’re maxed out… is silly,” says Daniel Fried, the former US State Department sanctions co-ordinator and Atlantic Council fellow.

Biden unwilling to crack down on energy exports

Joe Biden was long unwilling to crack down against Russian energy exports, fearful of the impact on pump prices and his chance of re-election.

In 2022, the US oversaw the creation of a price cap on purchases of Russian oil, set at $60 a barrel.

That was meant to impose a haircut on Moscow’s export earnings, rising and falling in line with the benchmark crude price (which slumped from a height of $124 to $66 over the course of Mr Biden’s term).

Mostly, however, it prompted Russia to create a so-called “shadow-fleet” of tankers to carry its oil to India, China and other nations, obscuring the origin of the fuel via foreign-flagged vessels.

After the Democrats lost in November, Mr Biden ratcheted up the pressure. The US imposed sanctions on two major Russian oil producers, LNG production and 155 “shadow-fleet” tankers, around half the total force.

A blow of sorts was dealt. In March, there was a 36 per cent month-on-month rise in Russian oil transported on vessels subject to the price cap. LNG revenues decreased by 22 per cent. But Russia’s monthly fossil fuel export revenues remained steady, in fact increasing by 1 per cent, according to Crea.

Sanctioning Russia Act

The US is now exploring what would effectively be the “nuclear” option. Lindsay Graham, the US senator, has widespread support in Congress for the Sanctioning Russia Act of 2025. This would impose a 500 per cent US tariff on goods from nations that buy Russian energy.

China, India, Turkey and Brazil would be forced to find alternative sources to retain access to the US market. The extension of sanctions on the central bank could further complicate trade. In effect, the move would mimic the “maximum pressure” sanctions imposed on Iran’s oil industry – and torpedo Moscow’s prime revenue source.

“This bill is a tool in President Trump’s toolbox,” Mr Graham, a close Trump ally, said earlier this month. When he believes that “we’ve reached an impasse, then watch for action”.

There is a team working on “hammer” sanctions in the US State Department that gained prominence recently over that figuring out “carrots” to offer to Moscow, says Tom Keatinge of the Royal United Services Institute, a London-based think tank.

In his Fox interview, Lt Gen Kellogg explicitly referenced Mr Graham’s bill as the source of the “very serious” sanctions pointing at Moscow.

The question is, will Mr Trump ever pull the trigger? The president has retreated when faced with the economic blow-back from his tariff policy. Having just reduced tariffs on China, it seems unlikely he would choose to reimpose them – at the highest rate yet – over a war his top negotiators suggested the US was willing to walk away from helping to end just weeks ago.

Emmanuel Macron, Sir Keir Starmer and other members of the “coalition of the willing” will no doubt do their best to convince Mr Trump. Tymofiy Myolvanov, president of the KSE, said on Wednesday the “rumour” going around was that the president would back Mr Graham’s bill. One senior European diplomat told The Telegraph not to discount Mr Trump’s appetite for tougher measures, should he be persuaded of the idea.

It is to Mr Trump’s advantage that Russian officials appear to find him “hard to read,” Mr Fried says. “There are those who argue [Mr Trump] will never pull the trigger because he is ultimately on Putin’s side. I’m not sure I buy that.”

Whether the uncertainty alone is enough to force Russia to take peace negotiations seriously is about to become clear. The gun is on the table. Putin and his inner circle will be assessing if they are right to keep betting the West does not really want to fire it.