Oleg Deripaska (R), CEO of Russian metals giant UC Rusal, takes part in a press conference to announce the company's 2009 annual results in Hong Kong on April 12, 2009. Rusal, the first Russian company to list on the Hong Kong Stock Exchange, said it swung back into the black in 2009 following its debt restructuring, reporting a net profit of 821 million USD.   AFP PHOTO / MIKE CLARKE / AFP PHOTO / MIKE CLARKE
Oleg Deripaska (right), CEO of Russian metals giant UC Rusal, takes part in a press conference to announce the company's 2009 annual results in Hong Kong on April 12, 2009. Photo: AFP / Mike Clarke

The US administration of President Joe Biden must reimpose economic sanctions on Russian oligarch Oleg Deripaska’s United Company Rusal aluminum concern, according to top members of the House of Representatives Financial Services Committee.

US House Financial Services Committee chairwoman Maxine Waters and ranking ,ember Patrick McHenry.

Speaking exclusively to Capitol Intelligence at an American Bankers Association (ABA) summit in Washington, committee chairwoman Maxine Waters, a Democrat, and Republican ranking member Patrick McHenry showed bipartisan support to reimpose economic sanctions after Rusal receive waivers from Donald Trump’s administration in December 2018.

Waters said she had always opposed the decision by then-treasury secretary Steven Mnuchin to waive economic sanctions against Rusal and that she was further disturbed by Rusal’s takeover of bauxite mining assets in Jamaica.

A source close to Rusal warned that reimposing sanction on the company would significantly disrupt the aluminum supply and cause new inflationary pressure in the United States.

“If the US wants aluminum prices to follow those of nickel and platinum and destroy the US economy, then I guess this would be the right thing to do,” the source said.

In fact, Rusal has leaked to the financial media that it is planning to spin off its non-Russian activities into a separate company.

Rusal is the second-largest aluminum producer after China Hongqiao Group and accounts for almost 9% of the world’s alumina production, while Pittsburgh-based Alcoa ranks as the sixth-largest aluminum concern.

The Rusal source said a merger with Alcoa would be blocked on antitrust grounds.

McHenry said the Biden administration should also prepare secondary sanctions against all those trading Russian assets, especially state-owned or state-controlled Chinese companies.

Banking and legal sources say Dubai has become a center of sanction breaking, with many financial parties attempting to buy Russian assets at “fire sale” prices.

McHenry said European sanctions against Russia for its Ukraine aggression was vital as US trade with Russia is minuscule compared with that with China.

“Two weeks of trade with China equals a full year of Russian-American trade,” McHenry told the ABA.

Waters’ and McHenry’s call for renewed sanctions came minutes before Biden announced the banning of Russian oil, gas and coal imports into the United States.

Peter K Semler is the chief executive editor and founder of Capitol Intelligence. Previously, he was the Washington, DC, bureau chief for Mergermarket (Dealreporter/Debtwire) of the Financial Times and headed political and economic coverage of the US House of Representatives and Senate.