Peng: US coal can bring end to Russia’s war in Ukraine
In a strategic move to pressure Russian President Vladimir Putin amid the ongoing conflict in Ukraine, former President Donald Trump is focusing on Russian coal as a key target for sanctions. Despite previous sanctions aimed at Russia’s oil and gas sectors, which have failed to significantly impede the Kremlin’s military operations, a concerted effort to disrupt the lucrative coal export market could yield more substantial results. Currently, Russian coal exports contribute approximately $31 billion annually to its war budget, with major buyers including China, India, South Korea, Taiwan, and Turkey—countries that are either allies or trading partners of the United States. Notably, Russian coal exports have now surpassed the value of its oil and natural gas exports, underscoring the critical role coal plays in sustaining Russia’s wartime economy.
The U.S. administration holds significant leverage in this situation, as it could negotiate lower tariffs on American coal exports in exchange for a reduction in Russian coal imports from these nations. With the U.S. coal industry already a major player in the markets of South Korea, Taiwan, and Turkey, there is a clear opportunity to fill the void left by Russian coal. This approach not only aims to weaken Russia’s financial resources for the war but also supports the American coal industry, aligning with Trump’s pro-working-class agenda. Furthermore, as the Russian coal sector faces mounting challenges due to lost European markets, rising operational costs, and a decline in energy prices, a targeted campaign against its coal exports could exacerbate these pressures and potentially shorten the conflict in Ukraine.
The implications of such a strategy are significant. By leveraging U.S. trade policies to cripple Russian coal exports, the administration could create political turmoil for Putin, who relies heavily on the coal industry for employment and regional economic stability. With over 140,000 jobs tied to coal mining in Russia, any disruption could have profound social and economic repercussions. As the war drags on, the urgency for effective measures to bring about peace grows. A focused initiative to diminish Russian coal sales could not only provide immediate economic benefits to American miners but also serve as a strategic tool to push for a resolution to the ongoing conflict. This approach is not only pragmatic but also resonates with a broader political consensus on using tariffs to counter military aggression, making it a compelling option for the current political climate.
President Trump continues to zero in on Russian energy to bring Vladimir Putin to the negotiating table. The administration has targeted Russian oil and gas giants with new sanctions and has imposed tariffs on U.S. trading partners that buy Russian oil.
If Trump wants the war in Ukraine to end, he needs to target Russian coal.
So far, sanctions against Russian energy sales have not done enough to stop Putin from continuing the brutal war. However, a targeted campaign to eliminate the market for Russia’s massive coal exports could make a difference.
Russia’s coal industry is under intense pressure after losing European buyers, but it has been able to export coal to other parts of the world, mainly Asia.
Russian coal exports are contributing $31 billion annually to its war budget, primarily from sales to five countries that are either allies or trading partners of the United States — China, India, South Korea, Taiwan and Turkey. Remarkably, Russian coal exports are now worth more than its pipeline oil and natural gas exports.
While persuading China to reduce its import of Russian coal is a tall order, the four other largest buyers are either close allies or major trading partners looking to secure favorable trade deals with the United States.
The administration holds the cards. Lower U.S. tariffs could be negotiated in exchange for swapping Russian coal imports for greater U.S. coal imports. The U.S. coal industry, already a major exporter to all four countries, has the capacity to displace Russian exports.
The logic for zeroing in on coal sales is simple: Not only is it a significant source of foreign currency for the Kremlin but Russia’s coal industry is on an economic precipice. Cracks are starting to show on Russia’s wartime economy, as sanctions, rising costs and weak energy prices are having profound economic repercussions.
Russia’s coal industry employs more than 140,000 people and remains critical in some regions, as a source of jobs and funding for local budgets.
A U.S. campaign to tighten the screws on the Russian coal industry would almost certainly produce serious political problems for Putin.
The war has gone on for far too long. If using U.S. trade leverage to cripple Russian coal exports could shorten the war by even a week, it’s a tool the United States should use. For Trump, it could deliver the peace he seeks and provide a boon to an industry he supports.
The idea of using tariffs to address problems like military aggression is an old one with broad political support. It is our unique political moment, combined with the populist appeal of dividends for American miners, that could turn the concept into reality. This strategy is pro-peace, pro-competitiveness and pro-working class, which aligns perfectly with Trump’s agenda.
Syd S. Peng is the Charles E. Lawall Chair of Mining Engineering emeritus in the Department of Mining Engineering at West Virginia University/InsideSources
