The United States should step up sanctions on Russian oil producers to force Moscow to negotiate with Ukraine, Scott Bessant said, criticizing the Biden administration for not taking a tougher approach against Vladimir Putin's regime.
Comments from Donald Trump's Treasury secretary nominee pushed oil prices higher on Thursday as traders considered the prospect of tighter global crude supplies. The new administration is also expected to impose tougher sanctions targeting Iran and Venezuelan oil as Trump seeks to increase economic pressure on U.S. adversaries.
"As part of (Trump's) strategy to end the war in Ukraine, I will 100 percent support increased sanctions, especially on Russian oil majors, to bring the Russian Federation to the table," Bessant told senators. At the table."
He claimed that U.S. sanctions on Russian energy were "not tough enough" because "the previous administration was concerned about raising prices during the election season."
Brent crude, the international oil benchmark, rose more than $1 to over $81 a barrel after Bessant's comments.
His remarks during a confirmation hearing on Capitol Hill came four days before Trump is set to return to the White House with a plan to enact sweeping tax cuts, higher tariffs and aggressive deregulation that contrasts with the outgoing Biden administration. A major shift.
U.S. stocks have rallied since Trump won the Nov. 5 election and Wall Street embraced his agenda, with the boss of the world's largest bank announcing huge profits this week, saying optimism about the new administration's economic plans had unleashed " Animal Spirits”.
However, major bank executives speaking this week also warned that Trump's threat to impose sweeping tariffs could stoke inflation.
The billionaire hedge fund boss used a grilling session before the Senate Finance Committee - which must approve his nomination before a full vote in the House - to defend the plans.
While Bessant did not provide new details, he said Trump would use tariffs to address unfair trade practices, increase U.S. government revenue and strike deals with other countries.
Bessant also said he would push China to buy more U.S. agricultural products, such as corn and soybeans, under the terms of purchase deals negotiated by Trump with Beijing to ease trade tensions during the Republican leader's first administration. He said Trump would continue to impose strict export controls on U.S. goods exported to China.
"We should have a very rigorous screening process for anything that can be used for artificial intelligence, quantum computing and surveillance, chips," he said.
Bessant also emphasized his support for extending Trump's tax cuts through the end of the year, calling it "the most important economic issue today."
Failure to extend the cuts targeted at individuals and businesses introduced by Trump in 2017 would trigger an "economic catastrophe" in the United States "and, as always, financial instability will fall on the middle and working classes." Fierce political battles over tax policy are expected in Congress this year.
Regarding the economic outlook, Bessant said he believed inflation would continue to be close to the Fed's 2% target and insisted that the Trump administration would respect the independence of the central bank's monetary policy.
But he warned that the U.S. Treasury would have difficulty using its "borrowing power" in times of crisis because of the deteriorating fiscal situation.
"I'm concerned because the Treasury Department has been called upon to rescue the country many times, whether it's the Civil War, the Great Depression, World War II or most recently, the COVID-19 pandemic," Bessant said.
"It would be difficult for us to do the same thing with the conditions we have now," he added.