U.S. to ban Russian oil imports

U.S. President Joe Biden on Tuesday banned Russian oil and other energy imports in retaliation for the invasion of Ukraine, underscoring strong bipartisan support for a move that he acknowledged would drive up U.S. energy prices.

"We're banning all imports of Russian oil and gas energy," Biden told reporters at the White House. "That means Russian oil will no longer be acceptable in U.S. ports and the American people will deal another powerful blow to (Russian President Vladimir) Putin's war machine."

Biden voiced America's support for the Ukrainian people, and predicted their ultimate victory.

"Russia may continue to grind out its advance at a horrible price, but this much is already clear: Ukraine will never be a victory for Putin. Putin may be able to take a city, but he'll never be able to hold the country," he said.

Oil prices jumped on the news, with Benchmark Brent crude LCOc1 for May climbing by 5.4% to $129.91 a bbl by 1345 GMT.

It was not immediately clear when the import ban would take effect.

Biden has been working with allies in Europe, who are far more dependent on Russian oil, to isolate Russia's energy-heavy economy and Putin. Britain announced shortly before Biden's remarks that it would phase out the import of Russian oil and oil products by the end of 2022.

Biden said sanctions imposed by the United States and its allies had already caused the Russian economy to "crater". He said the latest moves had been made in close consultation with allies and partners around the world.

The Democrats face tough congressional midterm elections in November when Biden's handling of the economy, and particularly rising prices, is expected to be a main issue with voters.

The U.S. imported more than 20.4 MM bbl of crude and refined products a month on average from Russia in 2021, about 8% of U.S. liquid fuel imports, according to the Energy Information Administration, and the ban is expected to send already high gasoline prices and inflation soaring. The U.S. also imports a negligible amount of coal from Russia.

Retail gasoline prices in the U.S. surged to an all-time record on Tuesday, and prices are expected to keep rising as the U.S. moves toward banning Russian oil imports. The average cost of a retail gallon of gasoline hit $4.173 early Tuesday, according to the American Automobile Association.

Biden predicted prices would rise further as a result of "Putin's war," but pledged to do all he could to minimize the impact on the American people. He also warned U.S. companies against exploiting the situation to engage in profiteering or price gouging.

"The decision today is not without costs here at home. Putin's war is already hurting American families at the gas pump ... I'm going to do everything I can to minimize Putin's price hikes here at home," Biden said.

"Russia's aggression is costing us all. It is not time for profiteering," said the Democratic president, who has repeatedly targeted big U.S. companies for unfairly jacking up prices.

In November, Biden had cited mounting evidence of anti-consumer behavior by oil and gas companies and asked the Federal Trade Commission to dig deeper into possible "illegal conduct" in the market.

Biden pushed back against charges from Republicans that his administration's policies were restraining U.S. energy production, noting that oil and gas firms had 9,000 permits to drill onshore that they were not using.

"We're approaching a record (level) of oil and gas production in the U.S. and we're on track to set a record level of production next year."

U.S. Senator Chris Coons said the administration was coordinating with European allies "and making sure that we've done the groundwork to understand how to effectively implement a ban on Russian energy."

"We are going to see increased gas prices here in the U.S. In Europe, they will see dramatic increases in prices. That's the cost of standing up for freedom and standing alongside the Ukrainian people, but it's going to cost us," Coons told CNN.

The White House had been coordinating with U.S. congressional leaders working on fast-tracking bipartisan legislation to ban Russian imports, but the ban announced Tuesday by Biden would make any such bill moot.

Biden said the crisis highlighted the importance of transitioning to clean energy supplies.

Republican lawmakers welcomed the decision on social media, while criticizing Biden's green energy policies, and urging the administration to support more oil and gas production at home.

U.S. Representative Susan Wild said Americans should to realize the larger sacrifice needed. "Obviously nobody wants to pay more for gas," Wild, a Democrat on the House of Representatives Foreign Affairs Committee, said on MSNBC.

In announcing that it is phasing out imports of Russian oil and oil products by the end of 2022, Britain said it is giving the market and businesses more than enough time to find alternatives to the imports, which make up 8% of demand.

"The government will also work with companies through a new Taskforce on Oil to support them to make use of this period in finding alternative supplies," British Business and Energy Secretary Kwasi Kwarteng said.

(Reporting by Trevor Hunnicutt, Steve Holland, Jeff Mason and Andrea Shalal; Editing by Heather Timmons and Alistair Bell)

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