Russia’s invasion of Ukraine has galvanized the U.S., U.K. and European Union to unleash a slew of sanctions meant to punish Russian President Vladimir Putin’s government and pressure him to pull his forces back.
But some officials from U.S. President Joe Biden's administration are now privately expressing concern that rather than dissuading the Kremlin as intended, the penalties are instead exacerbating inflation, worsening food insecurity and punishing ordinary Russians more than Putin or his allies.
Officials were initially impressed by the willingness of companies from BP to McDonald’s to abruptly "self-sanction,” sometimes selling assets at fire-sale prices. But the administration was caught off-guard by the potential knock-on effects — from supply chain bottlenecks to uninsurable grain exports — due to the companies’ decisions to leave, according to people familiar with internal discussions.