As violence continues in Ukraine, and Tillerson is confirmed, Trump mulls eliminating Obama era sanctions

Donald Trump is preparing to confront the complex political situation in eastern Europe. His administration is currently evaluating the existing set of U.S. sanctions against Russia. The Obama administration, the European Union, Canada, and other nations, imposed sanctions in 2014 over Russian military involvement in Ukraine.

On Saturday, Trump spoke amicably, in a first phone conversation, with Russian President, Vladimir Putin. They discussed the situations in Syria and Ukraine after Putin delivered congratulations on the Trump campaign’s 2016 victory.

A White House press statement said, “The positive call was a significant start to improving the relationship between the United States and Russia that is in need of repair. Both President Trump and President Putin are hopeful that after today’s call the two sides can move quickly to tackle terrorism and other important issues of mutual concern.”

President Trump may be able to thaw what was, under the Obama administration, an ice cold diplomatic relationship with Russia. He has emphasized his ability to orchestrate deals as a key attribute in approaching U.S. foreign policy. Trump has said he hopes closer ties with Russia will allow valuable cooperation on issues currently facing the international community.

One of the Trump Administration’s most important foreign policy goals is the utter destruction of the Islamic State in Syria-Iraq. It is in accomplishing this that the administration sees Russia as a valuable ally. Recently, Russia waged a vicious air campaign in Syria that resulted in heavy losses for ISIL.

Much closer to Moscow, Russia continues to foment violence in eastern Ukraine. In recent days, fighting between the Ukrainian government and Russian-supported rebel groups has increased significantly. The U.N. Security Council has urged an immediate end to the bloodshed and has warned that the situation is headed toward a, “dangerous deterioration.” This week, the eastern part of the country saw some of its worst violence in months, resulting in the deaths of at least eight Ukrainian soldiers and possibly dozens of civilians.

In a meeting on Tuesday, Ukrainian President, Petro Poroshenko, commented on the use of artillery against civilians, saying that, “The shelling is massive.” Both sides are, predictably, pointing fingers:

According to a statement from the Ukrainian Foreign Ministry, “[…] the occupying Russian forces carried out massive attacks across the contact line using all available weapons, including MLRS “Grad”, 152 mm and 122 mm artillery, 120 and 82 mm mortars, and tanks, all prohibited by the Minsk agreements, as well as small arms. Russian weapons have killed eight Ukrainian soldiers and wounded 26.”

According to a statement from the Russian Foreign Ministry, “Ukrainian troops continue to conduct offensive operations to seize positions held by self-defence forces, including in the suburbs of Donetsk. Heavy weapons, including heavy artillery and multiple launch rocket systems, are being actively used to shell residential areas. According to Minsk Package of Measures of February 12, 2015, such weapons should long since have been withdrawn from the contact line.” 

It is important to remember that Ukrainian rebel groups received significant aid from Russia some time ago. This aid has not stopped. Furthermore, one can assume that Russian forces have operated within eastern Ukraine since the beginning of the rebellion. Russian military force allowed for the smooth annexation of Crimea in 2014 and has also provided a powerful backing to rebel forces, allowing them to remain active and competitive against the government.

The Trump administration has indicated its intention to radically change the course of American foreign policy. This means President Trump will need to work toward developing close relationships with several European leaders. Some of them find his chosen approaches to NATO and to the Ukrainian crisis rather frustrating.

Candidate for German Chancellor, Martin Schulz, echoed the position of his opponent, Angela Merkel, saying“As long as the Minsk peace agreement is not fully implemented, the sanctions cannot be lifted. We must tell Putin very clearly that Russia is obliged to respect and defend international law.” Other NATO leaders have expressed similar opinions, including French President, Francois Hollande, and British Prime Minister, Theresa May.

Additionally, there are fears on both sides of the aisle that Trump will do little to oppose Russian efforts at aggressive expansion. These fears have been most apparent in criticisms of Trump’s choice for Secretary of State, Rex Tillerson, who has deep ties with Vladimir Putin. On Wednesday, senators voted 56-43 in favor of Tillerson’s confirmation. Tillerson received the highest ever quantity of Senate votes against confirmation as a Secretary of State in U.S. history.

There are concerns, especially among Democrats, over the possibility that sanctions on Russia might be lifted under Tillerson’s watch. During his confirmation, Tillerson was apparently unaware that Exxon Mobil lobbied against the Russian sanctions while he was Chief Executive Officer. He currently holds Exxon Mobil shares worth approximately $150 million.

Sen. Chris Murphy, who opposed the confirmation, recently made remarks critical of Tillerson, saying“We have reason to fear that Mr. Tillerson would run the State Department like he ran Exxon, where he repeatedly worked against U.S. national interests […] We have a President who has openly mocked human rights, who has supported vicious dictators, and a secretary of state who has made a career of doing business with some of the worst human rights violators in the world.”

There are also prominent Republicans anxious about the new administration’s approach to the Russian Federation. Despite the fact that he supported Tillerson’s appointment, Sen. John McCain asserted Friday, “For the sake of America’s national security and that of our allies, I hope President Trump will put an end to this speculation and reject such a reckless course […] If he does not, I will work with my colleagues to codify sanctions against Russia into law.”

Relevant to national security concerns are claims that Russia was somehow able to electronically influence the results of the 2016 election. Just before the new administration took office, President Obama ordered another set of sanctions against Russia intelligence officials. The sanctions came as retaliation for an alleged hacking campaign aimed at disruption.

Sanctions have had a measurable effect on the Russian economy, being the first omens of a nasty financial crisis. From the time of their imposition, the value of the Rouble declined dramatically. Part of this decline was an oil price drop from $100 to approximately $60 per barrel in 2014.

The Russian economy is heavily dependent on the extraction of natural resources as well as on foreign exports. Another, even larger price drop (from $147 to $33 per barrel) occurred during the 2007-2009 financial crisis. As a result of this, the Russian economy shrunk by almost an astounding 8% in 2009 alone.

Russia has the world’s eighth largest oil reserves. It is currently competing with Saudi Arabia and the United States for world’s largest oil producer. Russia also has the world’s largest natural gas reserves. Over the last ten years, Russia has received, on average, 25% of its income from oil and gas revenues.

Exxon Mobil has become one of the world’s top natural gas producing companies, behind the undisputed leader, Russia’s Gazprom. It has also been the largest American producer of natural gas for some time.

Exxon stands to benefit enormously from the removal of sanctions. They resulted in the freezing of several significant oil projects, some of which involved Exxon.  In fact, Exxon was one of the hardest-hit energy firms, losing out on approximately $1 billion.

Some will inevitably continue to argue that immediate attempts to a warm relationship with Russia are foolish or that they are embarrassing due to Vladimir Putin’s record on human rights and his militaristic opportunism. They will argue that cooperating with Russia on an equal footing only serves to make American foreign policy less legitimate.

A move to lift the Russian sanctions over Ukraine, without any major concessions from the Russian establishment, would, indeed, be embarrassing for the United States. Weakness would prevail where strength is most required. More importantly, it would delegitimize international law.

It is evident that economic sanctions have, to a certain extent, succeeded as retaliation. The longer that they remain in place, the better adapted the Russian economy will become to them. Russia has participated in engineering an environmental and humanitarian disaster in Ukraine. Russia also continues to participate in and to perpetuate the disaster. Diplomatic consequences should persist as long as this participation continues.

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