U.S. Preemptive Concessions Gain Nothing From Russia in Ukraine Ceasefire Talks (Part Two)

(Part One)

Executive Summary:

• Moscow is drawing Washington into an incremental, conditions-tied process, instead of a quick and unconditional ceasefire in Russia’s war against Ukraine. The U.S. White House has agreed to “help” Russia mitigate certain Western sanctions—including U.S. ones—that affect Russian agricultural exports.
• Russia demands the removal of those sanctions and restrictions as a precondition to a ceasefire in the Black Sea theater of war against Ukraine. Given the Trump Administration’s current high priority, Moscow seeks to combine these issues into a potential package deal.
• Such packaging is an artificial Russian construct, inspired by the defunct Black Sea Grain Initiative of 2022 in a wholly different situation in the Black Sea. Those Western sanctions are not a Black Sea-specific issue but apply across international markets to penalize Russia’s war against Ukraine.

Moscow is stonewalling the Donald Trump Administration’s pursuit of a quick, comprehensive ceasefire in Russia’s war against Ukraine. The Kremlin’s negotiating tactic is forcing the White House to adopt an incremental approach, pursuing narrow aspects of an eventual ceasefire instead. On March 23–25, in Riyadh, Saudi Arabia, representatives from the Trump Administration held technical-level consultations separately with Russian and Ukrainian delegations, focusing on a maritime and aerial ceasefire in the Black Sea Basin (see EDM, March 28).

The U.S. and Russian delegations agreed to continue discussions based on a text that leaves the Ukrainian ports outside of the scope of a maritime or aerial ceasefire. The text does not mention third-party, neutral enforcement of the ceasefire or at least monitoring of ceasefire violations. The wording potentially allows Russia’s Black Sea Fleet to return to the Sevastopol base following a ceasefire, well positioned to interfere with commercial shipping from there. Hinting at this intention, Moscow wants a ceasefire agreement to provide for inspection of cargoes at sea—something that the U.S. side has apparently turned down at this round of talks (Kremlin.ru; The White House, March 25).

Washington is holding out a commercial incentive for Russia to agree to a Black Sea ceasefire without delay. The United States and Russia released parallel statements with identical wording following the consultations. They said, “The United States will help restore Russia’s access to the world market for agricultural and fertilizer exports, lower maritime insurance costs, and enhance access to ports and payment systems for such transactions” (Kremlin.ru; The White House, March 25).

Pocketing the concessions on ceasefire terms along with the commercial incentives, Moscow has introduced new preconditions for accepting a Black Sea ceasefire. These are, for the first time in the ongoing negotiations, economic preconditions. The Kremlin’s communiqué demands the removal of Western sanctions and restrictions affecting Russian exports of agricultural commodities, foodstuffs (including fishery products), and fertilizers since the start of Russia’s war against Ukraine in 2022. Specifically, the communiqué states:

Those clauses [ceasefire and commercial] will come into effect following:

• Removal of sanctions imposed on Rosselkhozbank (Russia’s State Agricultural Bank) and other financial institutions conducting operations in the international trade with foodstuffs (including fish and fish products) and fertilizers;
• Reconnecting them to SWIFT, and opening relevant corresponding accounts;
• Removal of restrictions imposed on trade finance operations;
• Removal of sanctions imposed on food-producing and food-exporting companies (including fish and fish products) and fertilizers, as well as removing restrictions on insurance companies that provide coverage for foodstuffs cargoes (including fish and fish products) and fertilizer;
• Removal of restrictions on servicing ships in ports and of the sanctions against Russian-flagged ships, if they are involved in the trade with foodstuffs (including fish and fish products) and fertilizers;
• Removal of restrictions on supplying Russia with agricultural machinery and other goods used for producing foodstuffs (Kremlin.ru, March 25).

Russia insists on packaging discussions on a Black Sea ceasefire with bargaining over Western sanctions that affect Russia’s agricultural exports. The sanctions do not target Russian agricultural commodities and foodstuffs, the exports of which are legal and booming on global markets. The existing sanctions, however, complicate Russian exporters’ shipping, logistics, and insurance transactions, raising their costs as well as the costs of evasion.

Packaging those two negotiations together is a wholly artificial construct. The Western sanctions under discussion are by no means a Black Sea-specific issue, but apply across international markets to penalize Russia’s war against Ukraine.

It was Moscow who, in 2022, connected sanctions relief with the theater of war in the Black Sea. Under the 2022 Black Sea Grain Initiative, Russia eased its naval blockade of Ukraine, allowing grain exports from Odesa under Russian inspection (with Türkiye in a supportive role) in return for promises by the UN Secretariat in a non-binding Memorandum of Understanding to seek the removal of Western sanctions and restrictions affecting Russian agricultural exports (United Nations, accessed March 31). Russia abandoned that package deal in 2023, stating that UN Secretary General Antonio Guterres could not deliver sanctions relief for Russia (see EDM, July 26, 2023). According to the most recent report, Foreign Minister Sergei Lavrov stated that Guterres did not adopt a “principled” approach by calling outright for the removal of sanctions, but instead looked for loopholes or ways to circumvent them (Russian Foreign Ministry, March 25).

Russia, meanwhile, has lost the capacity to interfere with Ukrainian and international shipping in the western Black Sea, thus also losing the leverage to demand sanctions relief in return for easing commercial shipping access to and from Odesa (see EDM, March 21, 28). The Kremlin, however, seems to believe that the Trump Administration could support easing or lifting those sanctions in the context of a Black Sea ceasefire agreement.

The Kremlin has, accordingly, reinstated the artificial linkage between sanctions relief and the situation in the Black Sea, pursuing a package deal again. The sanctions and restrictions it seeks to have removed are the same ones that were at issue in 2022–2023. For its part, Russia has not encountered any impediments or incidents that have affected its commercial shipping in the Black Sea during these three years of war.

The European Union appears determined to maintain the existing sanctions, including those under discussion in the Black Sea ceasefire talks. Commenting on those talks, the European Commission announced, “The end of the Russian unprovoked and unjustified aggression in Ukraine and unconditional withdrawal of all Russian military forces from the entire territory of Ukraine would be one of the main preconditions to amend or lift sanctions” (EurActiv, March 28).

Moscow should be aware that any easing of sanctions by Washington would hardly benefit Russia, as long as the European Union continues to maintain these same sanctions. Even so, a hypothetical scenario in which the United States unilaterally rescinds or eases sanctions would perturb U.S.-EU relations, deepen some existing divisions within the European Union, position Washington at another degree closer to Moscow than to Kyiv, and ultimately translate into significant political and diplomatic gains for the Kremlin.