Treasury Secretary Steve Mnuchin said Friday that the Trump administration would not be issuing waivers to any companies looking to do business with Russia that is currently prohibited.
"In consultation with President Donald J. Trump, the Treasury Department will not be issuing waivers to U.S. companies, including Exxon, authorizing drilling prohibited by current Russian sanctions," Mnuchin said in a short statement.
The announcement is a blow to Exxon Mobil, which was reportedly seeking a waiver in order to participate in an energy project with a Russian state-run company. But it is welcome news for ardent opponents of Russia's annexation of Crimea and invasion of Ukraine, because a waiver for Exxon Mobil would have undermined the effectiveness of economic sanctions that were imposed to punish that aggression.
"This is a no-brainer," Rep. Eliot Engel, the ranking member on the House Foreign Affairs Committee, said Thursday. "The administration's answer to Exxon Mobil should be an unequivocal no."
Exxon's request was unsurprising, as the energy company opposed the sanctions in 2014 and would reap major benefits from their revocation or a waiver. A waiver grant would have put the Trump administration an uncomfortable position domestically and internationally, especially given Secretary of State Rex Tillerson's previous role as Exxon's chief executive.
"We do not support sanctions, generally, because we don't find them to be effective unless they are very well implemented comprehensively and that's a very hard thing to do," Tillerson told his shareholders in May of 2014.
Such sentiments would surely have arisen in conversations with German and Italian leaders, who backed the Ukraine sanctions with a similar reluctance. "For Italy it was a difficult choice because Italy and Germany were the two economies affected by sanctions, counter-sanctions, more than the others," Italian Prime Minister Paolo Gentiloni said Thursday during a trip to Washington, D.C. "But it was the right decision."
Russia is continuing to seek energy partners who can work outside of the western sanctions, however, most recently striking a deal with the national oil company in Libya — a crisis-riven North African nation with strong historic ties to Italy — and even pushing Italy for energy agreements. "Foreign direct investment from Russia going into Italy, it's pretty high, so they've got economically a lot to sustain by maintaining relations," the Foundation for Defense of Democracies' Boris Zilberman, an expert on the Middle East and Russia, told the Washington Examiner.