The world is none the wiser as Trump’s sanction deadline looms

The US special envoy Steve Witkoff met Vladimir Putin in Moscow yesterday to push Russia to end its war in Ukraine before tomorrow’s sanctions deadline.

So what? Mixed messages followed. Donald Trump increased tariffs on India, a major importer of Russian oil, then called the talks “highly productive”. Minutes later, a senior US official indicated that secondary tariffs would be imposed as planned. This will

• leave Ukraine to continue fighting to defend its country;
• put the creaking Russian economy under fresh strain; and
• force Moscow’s trading partners to weigh up the costs of doing business with Putin.

Same old. Witkoff, a real estate lawyer by trade, began his fifth trip to Russia this year with a stroll through a park near the Kremlin. Before a three-hour meeting with Putin, the pair were pictured warmly shaking hands. Moscow said the talks were “useful and constructive” but Witkoff left with little to show for them.

Or so it appeared, because it is unclear what was actually discussed. Volodymyr Zelensky and other European leaders got on the phone with Trump yesterday evening. Zelensky wrote on social media that they talked about what had been said in Moscow, but did not elaborate on the details. The US president reportedly said he was planning to meet Putin as soon as next week.

How far he’s come. On his return to office, Trump initially pandered to Russia while criticising Ukraine. His tone has changed. In recent weeks the US president has criticised Putin’s “bullshit” and called his bombing campaign “disgusting”. The ostensible reasons behind this shift include

• Nato’s agreement to new spending targets;
• Volodymyr Zelensky’s successful charm offensive with the US; and
• Trump’s frustration with Putin’s intransigence and commitment to the war.

Catch up. Trump told Putin to end the conflict in 50 days last month. He then drastically curtailed this deadline, threatening tariffs on Russia and its trading partners.

Nonplussed. Moscow has shrugged off this ultimatum, with a former Congressional staffer telling The Observer that Russia is “entirely disinterested in conflict termination on just terms and offers little to nothing to anyone in good faith”. Evidence for this can be found in Putin

• intensifying aerial attacks on Ukrainian cities;
• ramping up a summer ground offensive; and
• maintaining a maximalist position that Ukraine cede territory, become neutral and limit the size of its military in return for peace.

Psychology. Putin feels that Russia is winning, even as battlefield losses mount. Moscow’s economy is running on war fumes but has already weathered years of Western sanctions.

No dice. Sabre-rattling appears to have had little effect. Last week Trump ordered two nuclear subs to undisclosed regions near Russia following threats by Dmitry Medvedev, deputy chair of the security council. Moscow pulled out of a Cold War-era nuclear missile treaty in response.

Bigger fish. Putin’s military has been bolstered by North Korean troops, Iranian drones and components manufactured in China. The Russian leader reportedly wants to take control of Donetsk, Luhansk, Zaporizhzhia and Kherson in their entirety before discussing peace.

Olive branch. One concession the Kremlin reportedly could make to fend off secondary sanctions is an “air truce” under which Russia would suspend aerial attacks against Ukraine. This idea was floated after a meeting between Putin and Alexander Lukashenko of Belarus.

Not enough. This would signify de-escalation to a degree. But it falls short of Trump’s demand for a “deal where people stop getting killed” and it is not known if it was discussed yesterday. Marco Rubio, the US secretary of state later said many “impediments” to a ceasefire remained.

Prelude. Shortly after talks finished, Trump announced an additional 25 per cent tariff on India for buying Russian oil. This takes total US levies on Indian goods to 50 per cent and will take effect on 27 August.

Hooked. India imported little energy from Russia before the invasion, but is now the leading buyer of Moscow’s seaborne crude. Cheap Russian oil has allowed Delhi to keep inflation down and lessen the cost of fuel subsidies. But new levies on India’s US exports, which were valued at nearly $80 billion in 2024, could hurt more than ending the oil imports.

Main course. Trump is expected to table secondary tariffs against Moscow’s other trading partners on Friday. The US believes these are the best way to force Putin to negotiate since revenues from energy exports help to fund the war.

Risk and reward. Such tariffs could, however, send gas prices soaring and trigger waves of retaliation that disrupt the global economy. Trump appears to have at least half an eye on this.

Case in point… While India buys 38 per cent of Russian crude exports, China buys 47 per cent. The disproportionate focus on Delhi can be explained by the US being in the middle of delicate trade talks with Beijing, which have their own deadline next Tuesday.