The United States is signaling a renewed willingness to tighten economic pressure on Russia, with officials preparing potential sanctions aimed squarely at Moscow’s energy lifeline. According to people familiar with the discussions, the measures would be deployed if President Vladimir Putin refuses to engage constructively in peace talks with Ukraine. The timing underscores Washington’s attempt to align diplomacy with coercive leverage, as negotiations make tentative progress but remain stalled on core issues such as territory and security guarantees.

Energy Sanctions as Diplomatic Leverage

At the center of the US strategy is Russia’s oil trade, which continues to fund the war effort despite years of sanctions. Officials are weighing steps to target vessels in Russia’s so-called shadow fleet — tankers operating outside traditional insurance and compliance systems — as well as traders who facilitate crude transactions. Such measures would aim to raise the cost and complexity of exporting oil, rather than cutting supply outright.

Previous sanctions have already reshaped Russia’s energy flows, forcing crude to move at steep discounts and increasing reliance on opaque shipping networks. While these actions have strained Moscow’s finances, they have not yet altered Putin’s strategic objectives. The proposed escalation reflects frustration in Washington that incremental pressure has failed to deliver political concessions.

Market Reaction Muted by Structural Oversupply

Oil markets reacted cautiously to news of the potential sanctions. Brent futures briefly rose above $60 a barrel before paring gains, highlighting how geopolitical risk is being tempered by broader fundamentals. Global crude markets are entering a period of surplus, with demand growth slowing and supply expected to rise next year.

Sanctions fatigue is also evident among traders. Since 2022, sweeping restrictions on Russia have coincided with a long decline in oil prices, now down roughly 20% this year. This backdrop limits the immediate price impact of additional measures, even if they heighten volatility at the margins.

Diplomatic Progress Meets Persistent Sticking Points

The sanctions discussions come as US, Ukrainian, and European officials report incremental progress toward a peace framework. Talks have focused on post-war security guarantees for Kyiv, including mechanisms that could bind US commitments through congressional approval. However, major obstacles remain unresolved.

Russia continues to demand territorial concessions in eastern Ukraine, a condition Kyiv and its allies strongly oppose. Other contentious issues include the future use of frozen Russian central bank assets and control of critical infrastructure such as the Zaporizhzhia nuclear power plant. These unresolved questions cast doubt on whether sanctions alone can bridge the gap between the two sides.

Pressure Versus Incentives in the Final Phase

Attention is increasingly shifting to Putin’s response. While Russian officials have expressed cautious optimism that the conflict is nearing an end, they have shown little willingness to soften core demands. For the US, the threat of new sanctions is designed to sharpen the choice between economic relief and continued isolation.

Whether this approach proves effective remains uncertain. With oil markets structurally weak and Russia already operating under heavy restrictions, the marginal impact of further sanctions may be more political than economic. Still, the signal is clear: Washington intends to escalate pressure if diplomacy fails to deliver results.