What consequences US sanctions against Russian uranium may bear

The recent US ban on enriched uranium imports from Russia marks the first instance of tangible sanctions against Russian civilian nuclear energy.

Unlike many other segments of the Russian energy market, nuclear power had managed to avoid significant EU and US restrictions in the first two years of Russia's full-scale invasion of Ukraine.

Read more whether the EU will join this ban and whether this will mark the beginning of comprehensive Western sanctions against Rosatom in athe article by Ihor Moshenets, Central European University PhD – Nuclear sanctions: What will the US ban on Russian uranium imports achieve and will the EU join it?

Only certain subsidiaries of Rosatom had been included in Western sanction lists.

The leniency towards Rosatom was primarily attributed to its production and technological dominance in the nuclear industry.

The West's dependence on Rosatom's services is quite significant.

In 2021, Russian uranium accounted for 14% of US imports and the company also held a 28% share in uranium enrichment services. As for the EU, its share in uranium supply was 17%, 22% in conversion and 30% in uranium enrichment services.

Removing such economic dependencies required time to reorient production chains, which is much harder when a global market has limited supply.

Finally, US Senate passed the bill last week, extending the ban on Russian uranium imports until 2040.

It's not that simple though. The decision also includes certain more compromising provisions. In particular, the Department of Energy will have the authority to grant exemptions, provided that companies can demonstrate that they cannot obtain alternative supplies.

However, the validity period of all such exemptions is set to expire by early 2028.

Will such US restrictions trigger a domino effect, leading to a full-fledged sanction regime against Russian civilian nuclear energy?

Firstly, the loss of European and American markets by Rosatom will not be challenging for the Russian nuclear giant. Sanctions against Rosatom primarily aim to eliminate Western countries' dependence on Russia and fulfil their moral duty not to finance armed aggression rather than inflict significant destabilising damage on the Russian energy sector.

Such likelihood exist within the EU. Uranium reserves in the EU are sufficient to meet the continent's average needs for the next three years.

Moreover, the economic environment, created partly by the full-scale Russian invasion of Ukraine, is not in favour of the Russians. The increase in uranium prices stimulates activity in new extraction projects. Additionally, there has been noticeable activity from Western companies in the global uranium conversion and enrichment market over the past two years.

Thus, the American decision on uranium embargo could open up opportunities, even for European sanctions.

The situation regarding full-fledged sanctions against Rosatom in Europe faces currently a dead end. Experts speak of the time needed to achieve technological capability for a painless cessation of cooperation with Rosatom.

However, if immediate sanctions are met with arguments about technological obstacles, it's worth considering more flexible response options. More precisely, the first step towards successful imposition of sanctions could be the adoption of a medium-term strategy to reduce dependence on Russian civilian nuclear energy.