By Sanjeev Oak

U.S. Treasury chief Scott Bessent’s warning — no new tariffs on China over Russian oil unless Europe moves first — marks a pivotal shift. Sanctions are no longer American edicts; their bite now hinges on Europe’s will to bear the pain.

When U.S. Treasury Secretary Scott Bessent declared that Washington will not impose additional tariffs on China over its purchases of Russian oil “unless Europe goes first,” he did more than signal impatience. He reset the logic of economic coercion itself: the success of any future sanctions no longer hinges on U.S. resolve alone, but on Europe’s willingness to share the political and economic cost of enforcement.

“The U.S. is no longer offering unilateral remedies; it wants Europe to supply the ballast.”

The strategic logic behind the conditionality

The American reasoning is familiar: Russia’s oil revenues bankroll its war machine, so cutting them would tighten the screws on the Kremlin. But this time, Washington is unwilling to move first. By insisting on Europe’s participation, Bessent has wrapped economic pressure in political conditionality — and that serves three purposes.

First, it hedges U.S. risk. If Europe refuses, Washington can avoid unilateral tariffs that might disrupt its own economy or provoke retaliation. Second, it cloaks pressure with legitimacy. Multilateral sanctions carry moral weight and legal defensibility that unilateral moves lack. Third, it quietly acknowledges reality: global oil markets are too complex for lone enforcers. Plugging the loopholes — from maritime transfers to re-exports — demands Europe’s regulatory heft and market leverage.

Europe’s dilemma: solidarity versus self-harm

For Europe, the choice is fraught. Aggressive secondary tariffs could dent Russian revenues, but they would also inflate fuel prices, hurt energy-intensive industries, and trigger political backlash at home. Some member states remain more structurally exposed to Russian supply chains than others, making consensus even harder.

Legal complexity adds another layer: any EU-wide regime must withstand WTO scrutiny while being enforceable across multiple national systems. Enforcement is trickier still — the “shadow fleet” of tankers, opaque ownership chains, and ship-to-ship transfers has blunted earlier sanctions. Without serious investment in monitoring, port controls and insurance-sector pressure, any tariff regime risks becoming symbolic theatre rather than operational reality.

“Europe must decide if short-term pain is worth strategic gain.”

The shadow fleet and the mechanics of evasion

Russia’s shadow fleet has become the unseen backbone of its oil trade. Tankers shift flags, mask ownership, and conduct covert transfers beyond regulatory reach. Disabling that network demands more than political resolve — it requires targeted financial pressure on banks and insurers, port denials, blacklists and real-time maritime intelligence.

Markets react swiftly to the perception of enforcement. Oil futures, tanker rates and spreads respond to even small signals of tighter scrutiny. Yet as long as Russia finds willing buyers and creative workarounds, prices may wobble but volumes keep flowing, blunting the intended revenue squeeze.

India and China: sovereign choices meet geopolitical costs

Both China and India frame their oil purchases as sovereign energy decisions — and legally, they are right. This makes it politically difficult for democracies to condemn them outright. Yet Washington’s pressure calculus depends on their behaviour.

India and China both possess tools to blunt secondary sanctions: bilateral currency settlements, diversified shipping routes, and rapidly expanding refining capacity. That resilience means sanctions alone cannot strong-arm them — diplomacy and phased alternatives will be crucial if Washington hopes to erode their dependence on Russian barrels without rupturing strategic ties.

“India and China will not be coerced — they must be convinced.”

Two plausible pathways

Scenario One: Coordinated escalation (30–40%)
Europe acts boldly, crafting watertight secondary tariffs, tightening shipping and insurance rules, and closing refined-product loopholes. Moscow’s oil revenues collapse within months, and its war chest shrinks. But Europe pays dearly: energy inflation spikes and political backlash mounts.

Scenario Two: Fragmented adaptation (60–70%)
Europe dithers; buyers adapt. Russian crude keeps flowing through shadow fleets and indirect routes, revenues dip but endure, and markets stay volatile yet functional. Washington’s pressure loses edge, and Moscow outlasts the sanctions drag.

What Washington, Brussels and New Delhi should do

Washington must stop treating tariffs as a blunt instrument. It should invest in multilateral enforcement — joint tracking systems, port cooperation, insurance regulation — to make pressure credible.

Brussels must decide whether to absorb short-term pain for strategic gain. If yes, it must legislate enforceable refinery-level checks, curb shipping evasions, and build welfare buffers for industries and households.

New Delhi should publicise its gradual diversification plan to reduce dependence on Russian crude while negotiating time-bound, transparent carve-outs that preserve energy security without signalling permanent immunity.

The deeper shift: the rise of multipolar enforcement

Bessent’s stance exposes a larger structural shift: sanctions power now depends on coalition politics. The old assumption — that Washington could police global markets alone — no longer holds. This reality is already accelerating de-dollarisation experiments, regional payment networks, and non-Western financial ecosystems.

“If enforcement is uneven, markets will invent their own workarounds — and geopolitics will be rewired around those workarounds.”

The clock is not just on Europe — it is on sanctions themselves

Bessent’s conditional posture is not a threat; it is a warning. Coercion without operational enforcement is theatre. If Europe steps up, the coming months could deliver a decisive blow to Moscow’s oil revenues. If it hesitates, sanctions will muddle on — while Russia, China and others accelerate the creation of parallel trade and financial systems.

Either way, the architecture of global sanctions is at an inflection point. The choice Europe makes will shape not just Russia’s revenue curve, but the very future of Western economic statecraft.

The Author is a geopolitical analyst. Views are personal.