This Commentary builds on the previously proposed surcharge mechanism designed to drive Russian oil revenues lower. In short, the U.S. government would impose a fee on Russia’s oil customers, like India, in exchange for waiving strong new secondary tariffs.
This approach is designed to isolate Moscow’s revenues in isolation: without trying to sink global oil prices (bad for U.S. industry economics) and without removing large Russian volumes from the market that would risk a price spike (bad for the fight against inflation).
This analysis addresses three key considerations arising from our proposal to maximize U.S. leverage to end the war in Ukraine.
The Russia Oil Surcharge: Anticipating the Benefits and Challenges
