September 1st, 2025 | Nathan Daniel

Why Russia Is An Enemy

It's all about the long game.

If you judge nations by the geology beneath their feet and the pipes, rails, and ports that carry that geology to market, Russia is a kind of world-sized battery: vast hydrocarbons; critical metals like nickel and palladium; uranium, coal, diamonds; enough timber and wheat to move commodity indices. In a frictionless world, that endowment would translate directly into power. But international politics is deliberately un-frictionless—full of rules, chokepoints, and veto players—and for decades, the United States and its closest allies have built and refined an architecture that restrains Russia’s ability to convert its resource base into unchallengeable geopolitical weight. They call it deterrence, standards, and rule-setting. Moscow calls it encirclement and strangulation. Whatever label you prefer, the effect is plain: Russia’s path from resource giant to system-shaping superpower runs through a gauntlet designed by others, and the gauntlet keeps getting tighter.

This is how Russia’s resource advantages threatens to reorder markets; how energy transit and technology choke points were used to hem Russia in; how finance and sanctions matured into a precision weapon; and how narratives of “malign influence” became the political sealant. It also acknowledges the obvious caveat: Russia’s own choices—most decisively the 2014 seizure of Crimea—triggered many of the harshest measures. But the core strategic logic predates those decisions and outlives them: a resource-maximized Russia would tilt the balance of power away from the U.S.-led order, so the order acts to prevent that outcome.

A resource base that is system-shaping

Start with the geology. On natural gas, Russia sits near the top of the global league tables, with enormous proven reserves and historically dominant export capacity into Europe. Before 2022, Russia supplied roughly 155 billion cubic meters of gas to the European Union annually—about 45% of EU gas imports and nearly 40% of consumption—a level of leverage that no other single producer enjoyed over a major industrial bloc.[1] Even after wartime disruptions, analyses continue to place Russia among the largest holders of proven gas reserves and one of the few actors capable of scaling pipeline or LNG exports at continent-shaping volumes.[2]

On minerals, Russia is not just “rich,” it is strategically rich. It is the world’s pivotal palladium supplier (a metal essential for catalytic converters and multiple clean-tech inputs), and a top producer of nickel, critical for certain battery chemistries and specialty steels.[3] Through companies like Norilsk Nickel, Russian output has repeatedly demonstrated its ability to move global prices when access is threatened. Fertilizers and wheat round out the picture: Russia’s role as a major exporter of nitrogen, potash, and complex fertilizers—and as one of the top wheat exporters—gives it durable leverage over food-price stability across the Global South.[4]

This portfolio—gas to heat Europe and power industry, metals to wire and decarbonize supply chains, grains to steady governments—could, if unconstrained, amount to a form of structural power. It would let Moscow write terms in regional markets, attach conditions to access, and extract political returns far beyond its GDP ranking. The U.S. and its allies have not been blind to this. For years, they have pursued a layered strategy to prevent Russia from fully cashing that geological check.

Transit politics: fencing in the pipes

Pipelines are politics laid in steel. Whoever controls routes controls options. In the 2000s and 2010s, Russia sought to bypass vulnerable transit states (notably Ukraine) and lock in long-term demand in the EU with a lattice of direct connections: Nord Stream under the Baltic, South Stream across the Black Sea (later replaced by TurkStream), and various upgrades to Druzhba and Yamal systems. Western policy responses met these plans not on the battlefield but in the lawyers’ briefs and regulatory annexes of Brussels and Washington.

The EU’s Third Energy Package forced the unbundling of production and transmission and curbed the ability of a supplier like Gazprom to control both the gas and the pipe that carried it—constraints that complicated projects like South Stream and ultimately contributed to its cancellation in 2014.[5] In parallel, the U.S. Congress and successive administrations developed a sanctions toolkit to directly target Russian export routes deemed strategically dangerous to Europe’s energy independence. The Protecting Europe’s Energy Security Act and later guidance explicitly threatened penalties on companies laying or insuring Nord Stream 2, helping delay the project for years; and when Russia crossed Ukraine’s borders in February 2022, Germany halted certification altogether, killing the most geopolitically consequential gas lever Moscow had built.[6]

This was not “market competition.” It was a deliberate political choice to keep the largest seller from hardwiring the biggest market to its molecules.

Technology choke points: freezing future barrels and molecules

Oil and gas are increasingly a technology business. The “easy” reservoirs are depleted; what remains in abundance is often deepwater, Arctic offshore, or shale—resources that require specialized seismic tools, subsea kit, drilling fluids, completion technologies, and know-how concentrated in a few Western service firms. After Crimea in 2014, the U.S. created Directive 4 under its Russia/Ukraine sanctions regime to sever that umbilical cord: U.S. persons were prohibited from providing goods, services, or technology supporting Russian deepwater, Arctic offshore, or shale oil projects.[7] In 2017, the scope expanded: new projects anywhere in the world involving key Russian firms could be touched, provided those firms had qualifying ownership stakes.[8]

The effect? ExxonMobil walked away from marquee joint ventures with Rosneft, including long-planned Arctic exploration that was supposed to unlock the next tranche of Russian barrels.[9] Other Western majors and service companies shelved or exited frontier projects. Even where legacy ventures (like Sakhalin-1 LNG) initially survived, the investment signal was unmistakable: the future of Russian liquids—especially the technologically complex ones—would be starved of Western capital and kit.

This is strategy by time horizon. You don’t need to shut in today’s production if you can foreclose tomorrow’s. And it mirrors parallel controls in other sectors (e.g., semiconductors for defense and industrial use): map the critical nodes; deny access; let the opportunity cost accumulate on your rival’s balance sheet.

Financial statecraft: from blunt embargo to scalpel

Sanctions used to be leaky and symbolic. Not anymore. Over the last decade, the U.S., EU, and G7 built an integrated system that targets firms, sectors, and sovereigns with granular precision—and links those prohibitions to the plumbing of global finance and trade (SWIFT messaging, dollar clearing, maritime insurance, classification societies, compliance software). Two examples show how that system corralled Russia’s resource power.

First, the 2018 sanctions on Rusal—Russia’s aluminum giant—were a live demonstration. Overnight, the London Metal Exchange moved to disallow Rusal metal; prices spiked 30% in days, and downstream industries scrambled.[10] Washington later unwound those specific sanctions after corporate restructuring, but the episode proved a point: Western authorities could weaponize exchange rules and liquidity to quarantine a major Russian commodity and force market-moving outcomes on short notice. In 2024, the U.S. and UK went further, barring the LME and CME from accepting new Russian aluminum, copper, and nickel, putting a long fuse under the same lever across base metals.[11]

Second, after February 2022, the allies graduated to sovereign-scale measures. They froze roughly $300 billion in Russian central-bank reserves parked in G7 and EU jurisdictions—by far the largest such immobilization in modern history—and have since debated or implemented mechanisms to redirect the interest (“extraordinary revenues”) to Ukraine and to extend the freeze indefinitely.[12] They also ejected major Russian banks from SWIFT, limited correspondent banking, banned new investment, and—crucially—paired embargoes on seaborne Russian crude and products with a novel price cap regime: if a cargo is sold above $60 (crude) or the set product caps, Western insurers, shippers, and traders cannot touch it.[13] Because the West dominates those services, the cap rides along with the barrel wherever it sails.

Critics note—correctly—that Russia has found workarounds, cultivating a “shadow fleet,” tapping non-Western insurers, and redirecting flows to Asia. But the cap still acts like a tax on Russian rents, forcing deeper discounts and complicating logistics. And because enforcement can be tightened at will—by blacklisting vessels, sanctioning front companies, or raising due-diligence burdens—the tool remains adjustable. The larger point stands: the West has fused commodity governance with financial control to put a ceiling on how much resource revenue Moscow can monetize in the core currency zones that still matter most.

Market re-wiring: starving the demand side

Supply constraints mean little if demand is inelastic. So the other prong of the strategy was to rewire Europe’s energy system away from Russia. The facts before 2022 were stark: Russia supplied almost half of EU gas imports and a big share of oil and coal.[14] In response to the invasion, Brussels and national capitals moved at wartime speed: emergency LNG import capacity, mandated storage fill levels, accelerated renewables, conservation campaigns, fuel switching, and pipelines reversed to pull molecules from the Atlantic rather than the east. The net effect was to drive Europe’s intake of Russian pipeline gas down precipitously within a year and to set an explicit policy target of ending dependence by the mid-2020s.[15]

That is not just decarbonization. It is strategic de-Russianization of the marginal unit, so that any future Kremlin squeeze finds less purchase. For a country whose geopolitical leverage has historically come from being the inevitable supplier to its richest neighbors, that’s a structural loss.

Narrative warfare: legitimacy as a non-tariff barrier

Rules and pipes are visible. Narratives work in the background. Over time, the U.S. and several European governments constructed a political story about Russia that makes its exclusion from markets or technologies not just permissible but normative: a state that uses energy as a weapon, interferes in elections, conducts assassinations abroad, launders money through oligarchs, and wages aggressive war. Pieces of that narrative are true on their face (murder in Salisbury, cyber operations, the invasion of Ukraine), and Russia’s actions gave its adversaries ample material. But the function of the narrative is as important as its truth value: once a country is coded as a bad actor, every commercial interaction with it becomes reputationally hazardous; every joint venture triggers NGO campaigns and shareholder revolts; every pipeline must clear a higher political bar.

From the Magnitsky Act era through the sanctions packages of 2014 and the full-spectrum measures of 2022–2025, that narrative provided the domestic coalition to sustain costly policy. It also harmonized cross-border enforcement: regulators, exchanges, and corporate compliance departments internalized the risk that dealing with Russia might cross a red line—today or retroactively. The result is a quasi-embargo by consensus, layered atop formal law.

Why this makes Russia an “enemy”

Put the components together and the strategic picture tightens. If Russia were free to fully exploit and market its gas, oil, metals, and fertilizers—at scale, to the richest customers, at world prices, with Western technology and finance—the spillovers would be dramatic. European industry would be structurally tied to Russian energy; Asia would diversify toward Russian barrels and metals; and Moscow would convert rents into defense R&D, diplomatic patronage, and influence operations at a level the U.S. and EU would find unacceptable. Preventing that end state requires, from a Western perspective, treating Russia not as a competitor to be accommodated but as a systemic adversary to be managed and, where necessary, contained.

That is what enemies are in the 21st century: not always foes you shoot, but rivals you regulate. You turn their pipelines into compliance traps. You turn their sovereign wealth into frozen collateral. You turn their future oilfields into museum pieces by denying the toolkits that would bring them online. And you inoculate your own publics so that when prices spike or contracts break, the politics doesn’t buckle.

But didn’t Russia bring this on itself?

This is the unavoidable rejoinder, and it matters. Russia’s 2014 annexation of Crimea and the 2022 full-scale invasion of Ukraine were acts of aggression that triggered many of the most punishing responses described above. However, many of the barriers to antagonize Russia were put in place by the West long in advance. 

The EU’s internal market rules that tripped up South Stream were a decade in the making. U.S. sanctions architecture specific to Russian oil technology dates to 2014, with legal expansions in 2017. Washington’s opposition to Nord Stream 2 was bipartisan across administrations. European and American think tanks had been publishing de-dependence blueprints for years; once the crisis arrived, those blueprints were pulled off the shelf. In other words, Russia’s actions supplied the political ignition, but the strategic kindling was already stacked.

One measure of a strategy’s success is the pain it imposes on the target even when the target adapts. Russia has adapted—redirecting crude to Asia, offering steep discounts, improvising a parallel shipping ecosystem, and boosting domestic industry where imports were cut off. But the opportunity cost is massive. Arctic and deepwater prospects have lost years; Western majors that could have de-risked frontier plays are gone; capital is pricier and scarcer; and the biggest nearby market—Europe—is accelerating out of Russian hydrocarbons by design.

Meanwhile, Western authorities keep demonstrating they can yank levers in spot and futures markets to disadvantage Russian producers of metals and energy at moments of their choosing—whether by nudging exchanges to restrict origin-brand flows, tightening price-cap enforcement, or signaling the next round of secondary sanctions. If you are a portfolio investor, a shipowner, an insurer, or a board member at a multinational, the rational response is to de-risk Russia. That is a slow bleed by itself.

Russia is treated as an enemy not simply because of who governs it at a given moment, but because of what it is in the material sense: a resource superpower whose unconstrained integration into Western markets would magnify its influence beyond what the U.S.-led order is prepared to tolerate. The order’s answer has been to bind, limit, and tax that power at every node that matters—law, finance, technology, and narrative. It’s a strategy that speaks softly on some days and swings a very big stick on others. It is also, for now, working as designed.