Executive Summary

• Russia is seeking sanctions relief in discussions over Ukraine, with a focus on hydrocarbon revenues, financial reconnection, and access to high-tech imports. 
• The Kremlin’s wish list would bring immediate economic benefits for Moscow that could enable sustained military activity and long-term reconstitution of its armed forces. 
• Financial sector measures, including SWIFT access and correspondent banking, are among Russia’s highest priorities. 
• Responsibility for sanctions is divided: the US Executive Branch has flexibility in some areas, while Congressional authority and EU unanimity are required in others. 
• Easing sanctions without reciprocal concessions would damage transatlantic alignment and reduce deterrence. 
• US and EU policymakers must assess the strategic implications of any proposed relief and reinforce institutional mechanisms to prevent premature or haphazard rollback. 

Introduction

Russia has made sanctions relief a central demand in negotiations about the war in Ukraine. The Kremlin is pursuing the rollback of various economic and technological restrictions, which it views as essential to stabilizing its economy and reinforcing its strategic posture. The demands are not isolated; rather, they reflect a coordinated effort to reshape the economic landscape in Russia’s favor while testing the resilience and unity of the transatlantic alliance. With European policymakers already drafting the EU’s 18^th sanctions package, and legislation working its way through the US Senate to impose secondary sanctions on Russian oil exports, that resilience appears to be holding. As pressure for a ceasefire mounts, however, strategic clarity will be the name of the game. 

In February and April 2025, US President Donald Trump’s administration moved to extend sanctions against Russia, maintaining pressure on Moscow for the time being and using the restrictions as both a stick and a carrot in the negotiating process. As policymakers in Washington and Brussels face critical choices, understanding what Russia wants, who controls the levers of relief, and the implications of granting such relief are fundamental to crafting a coherent and effective policy response. This paper offers an analysis grounded in strategic interests and institutional mechanics which aims to inform decisions that could shape the trajectory of European security and transatlantic relations for years to come. 

Allies’ Toolkit

Countering America’s Adversaries Through Sanctions Act (CAATSA)  

• The Countering America’s Adversaries Through Sanctions Act (CAATSA) was signed into law by President Trump in August 2017 in response to Moscow’s interference in the 2016 US Presidential Election, its annexation of Crimea, support for separatists in eastern Ukraine, and aggression in Syria. 
• The act’s purpose was to codify punitive measures previously enacted under Obama-era executive orders. It stops US companies conducting business with sanctioned entities and threatens secondary sanctions against nations doing business in key Russian sectors, such as cybersecurity and defense, significantly hindering Russia’s access to Western technology and foreign investment. CAATSA also establishes congressional oversight for executive branch changes to sanctions on Russia.   

Protecting Europe’s Energy Security Act (PEESA)

• The Protecting Europe’s Energy Security Act (PEESA) is a US law, enacted in December 2019, with the primary goal of disrupting the construction of Russian energy pipelines in Europe, particularly Nord Stream 2.  
• The objective was to limit European energy dependence on Russia, shoring up the continent’s energy security and limiting Moscow’s leverage. The act directly targets companies involved in the construction of Russian pipelines, freezing assets and implementing travel bans on individuals involved.  

Iran Freedom and Counter-Proliferation Act (IFCA)

• The Iran Freedom and Counter-Proliferation Act (IFCA) was part of broader sanctions signed into law in January 2013 to exert pressure on Tehran over its nuclear program and ballistic missile development. The act sought to hinder Iran’s capacity to sustain these projects by directly sanctioning entities involved in its shipping operations, supplying it with precious metals, and servicing its energy sector. 
• The legislation indirectly affects Russia by sanctioning entities and individuals engaging with the Iranian nuclear and military sectors. 

EU Sanctions Packages

• Since Moscow’s full-scale invasion of Ukraine in February 2022, the European Union has adopted 17 successive sanctions packages targeting various aspects of the Russian economy. They have frozen central bank assets, implemented trade restrictions, tightened export controls, limited Russian access to defense sector technology, imposed travel bans and asset freezes on targeted individuals, and targeted Russia’s “shadow fleet,” reducing its ability to circumvent Western sanctions. 
• The EU has been swift and nimble in its ability to pass sequential sanctions packages, which have evolved in parallel with developments in the war in Ukraine and Moscow’s wider attempts to stabilize its wartime economy.  

Russia’s Wish List

Russia’s push for sanctions relief is both specific and strategic, and at the forefront is its desire to reestablish links with the global economy. The reconnection of Rosselkhozbank and other institutions to the SWIFT interbank messaging system is a high priority, as it would facilitate international transactions and reduce reliance on inefficient domestic alternatives. This request was explicitly raised during Black Sea ceasefire negotiations, signaling how central it is to Moscow’s broader aims. 

Closely tied to the bid to rejoin SWIFT is Russia’s pursuit of renewed access to international financial flows. This includes opening correspondent accounts in Western banks, which would ease the movement of reserve currencies, reduce transaction costs for both exports and imports, and bolster the liquidity of Russian institutions. Moscow is also seeking relief from general financial sector restrictions which have curtailed its access to capital markets, frozen sovereign and private assets, and limited financing options for its companies and government. 

The energy sector features prominently on the Kremlin’s list of demands and it is eager to lift sanctions on oil exports, particularly those affecting its tanker fleet and maritime insurers. These restrictions have complicated Russia’s ability to sell oil around the world and forced it to offer discounts to maintain export volumes. The specter of secondary sanctions on countries such as India, China, and Turkey has also introduced uncertainty into key bilateral energy relationships. Russia is likely to push for reassurance that these measures will not be expanded or aggressively enforced. 

Moscow has also expressed interest in reviving the Nord Stream 1 and Nord Stream 2 gas pipeline projects. These symbolic and economic assets have long been at the center of geopolitical tensions due to Russia’s use of natural gas as a weapon against European democracies. Three of the four Nord Stream trunklines were damaged in a sabotage incident in September 2022, but talks to revive both projects have nevertheless continued. Any move to resurrect the pipelines would represent a fundamental shift in US energy and security policy toward Europe, increase national security risks across the north of the continent that have been mitigated by existing Nord Stream sanctions, and undermine the Trump administration’s goal of exporting more US gas to global markets. 

Beyond hydrocarbons, Russia is targeting the restoration of global market access for its agricultural and fertilizer exports. This would involve not only the reduction of export barriers but also the lifting of restrictions on maritime insurance and port access. These measures would ease the movement of goods and enhance Moscow’s ability to generate non-energy revenue in global markets. 

The Kremlin is also seeking relief from high-tech export controls. While research shows Russia has managed to source some military-grade components through third-party countries, there remains a significant shortfall in areas such as precision tools, aviation and maritime engines, power generation systems, and computer-controlled machinery. Alleviating restrictions would directly support Russia’s military-industrial base and civilian technological development. 

Consequences of Sanctions Relief

Granting Russia sanctions relief, particularly in the areas it has prioritized, would have far-reaching consequences for the balance of power in Europe and beyond.  

Reconnecting Russian banks to SWIFT and permitting correspondent banking relationships would ease the frictions currently hobbling foreign trade and access to hard currency, reducing the cost of export sales and increasing profits for oil and other commodity companies. It would also reduce the cost of importing goods, spare parts, and machinery, easing inflationary pressure on the ruble and providing the Kremlin with greater flexibility to manage its budget and increase spending, particularly on its armed forces and weapons systems.  

The removal of financial sector restrictions would allow for increased capital mobility, greater foreign direct investment, and enhanced access to credit for both public and private actors. In turn, this would boost the domestic investment climate and improve industrial output. Such economic stabilization would reduce the internal pressures that sanctions have created and provide a more durable base for increased military activity. 

Sanctions relief in the energy sector would be especially consequential as Russia derives about a third of its federal budget from hydrocarbon exports. Sanctions on its shipping capabilities and insurers have forced the Kremlin to adapt by creating a “shadow fleet” and rerouting exports, but these workarounds are inefficient and costly. Energy curbs have also forced Moscow to adjust taxation for oil exporters, which, while ensuring the flow of petro-rubles to the treasury, depresses energy companies’ profits and long-term investments. Removing these constraints would increase Russia’s revenue and reduce transaction costs, providing additional funds that could be directed toward military reconstitution, domestic subsidies, or geopolitical ventures. 

Easing the threat of secondary sanctions would make it easier for Russia to solidify its relationships with key non-Western buyers, thereby mitigating the broader economic impact of Western sanctions. This would not only stabilize Russia’s export markets but also deepen its ties with countries less aligned with the transatlantic alliance. 

The implications of lifting high-tech export controls are similarly grave. Russia has struggled to produce some advanced military and industrial equipment domestically, and access to Western components would improve the precision and reliability of its weapons systems, enable more effective maintenance, and replenish critical stockpiles. Over time, this would make Russia’s military campaigns more sustainable and its deterrence more credible. 

Together, these changes would significantly reduce the leverage that sanctions provide, making it harder for the West to influence Russian behavior by economic means. They would also send a signal to other authoritarian regimes that persistent pressure can eventually yield concessions without meaningful reciprocal action. 

Who Holds the Reins?

Understanding who has the authority to maintain or lift the sanctions Russia wants removed is essential to anticipating potential policy outcomes. In the US, the division of authority is complex. Many sanctions were initially imposed through executive orders, giving the President substantial discretion over their enforcement and potential rollback. However, Congress has acted with overwhelming bipartisan support to constrain this power through legislation such as CAATSA, which codified a range of sanctions and imposed procedural barriers to their repeal. 

Congress has the authority to legislate new sanctions, codify existing executive measures, and block executive actions through its mechanisms for oversight and appropriation. This means that, even where the administration seeks flexibility in negotiations, it may be limited by statutory obligations and political realities. 

In the EU, the structure is different but similarly constraining. The most impactful sanctions, including those related to SWIFT and financial access, fall under EU legislation and require the unanimous consent of all 27 member states for renewal or revision. SWIFT itself is regulated by 12 central banks, including the European Central Bank and those of the largest European economies, and any inclusion of a Russian financial institution in the interbank system would need consent from those European central banks.  

While the bloc has so far maintained unity and signaled continuity, this consensus is not guaranteed. Countries such as Hungary have telegraphed opposition to continued sanctions, though they have ultimately acquiesced or been sidelined at critical junctures. Looking ahead, Brussels is laying the groundwork for a new approach, based on tariffs and capital controls, that may prove more durable. 

European leaders are considering legal reforms that would shift certain sanctions decisions to domestic jurisdictions or qualified majority voting, removing the effective veto for the bloc’s member states. These efforts reflect a growing awareness of the strategic importance of maintaining cohesion in the face of Russian pressure.

Ultimately, the authority over Russian sanctions relief is fragmented across multiple jurisdictions and institutions. Effective policymaking will depend on a shared understanding of the broader strategic stakes and coordination among these actors. 

Policy Recommendations

US and European sanctions — while often implemented too late and enforced too timidly — have played an important role in containing and constraining Russian aggression. That leverage, however limited, should not be abandoned without a granular focus on the costs and consequences of each potential item of sanctions relief. With that in mind, the Trump administration, Congress, and Europe can work together and in parallel to create a robust policymaking structure to ensure any future sanctions rollback is guided by strategic analysis and vigorous oversight. 

1. Link Relief to Concrete Concessions: Any sanctions relief should be clearly conditional on verifiable and strategically meaningful actions by Russia. Unenforced ceasefires or ad hoc freezes should not be sufficient to trigger long-term concessions. 

2. Codify Executive Sanctions in US Law: Congress should act to enshrine critical sanctions — particularly those targeting financial flows and energy exports — into statutory law to maximize oversight and accountability. 

3. Reinforce EU Consensus: European leaders should strengthen the institutional basis for sanctions renewal by securing political commitments from member states or by pursuing legal mechanisms that reduce the risk of vetoes. 

4. Maintain Transatlantic Coordination: The US and EU must coordinate closely to avoid policy divergence that could weaken collective leverage or create economic arbitrage opportunities for Moscow. 

5. Protect High-Tech Controls: Export restrictions on sensitive technologies should remain robust even if a durable ceasefire takes hold, with enhanced oversight mechanisms to prevent circumvention through third-party countries. 

About the Authors

Sam Greene is the Director for Democratic Resilience at the Center for European Policy Analysis (CEPA).

Alexander Kolyandr is a Senior Fellow with the Democratic Resilience Program at the Center for European Policy Analysis (CEPA).

Benjamin L. Schmitt is a Senior Fellow with the Democratic Resilience program at the Center for European Policy Analysis (CEPA).

David Kagan is a Program Officer with the Democratic Resilience program at the Center for European Policy Analysis (CEPA).

CEPA is a nonpartisan, nonprofit, public policy institution. All opinions expressed are those of the author(s) alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.