Saudi Press

Saudi Arabia and the world
Saturday, Jun 21, 2025

US' "Likely" Move That Could Push Russia Into Debt Default

US' "Likely" Move That Could Push Russia Into Debt Default

Punishing sanctions imposed following Russia's invasion of Ukraine in late February have largely severed the country from the international financial system, blocking Moscow's ability to access dollars held in US banks to pay its debts.
The United States will likely end an exemption allowing Moscow to pay its foreign debts with dollars held in Russia, the US treasury secretary said Wednesday, a move that could push Vladimir Putin's country into default.

"When we first imposed sanctions on Russia, we created an exemption that would allow a period of time for an orderly transition to take place and for investors to be able to sell securities," said Janet Yellen.

"And the expectation was, that it was time limited. So I think it's reasonably likely that the licence will be allowed to expire."

Punishing sanctions imposed following Russia's invasion of Ukraine in late February have largely severed the country from the international financial system, blocking Moscow's ability to access dollars held in US banks to pay its debts.

The Russian government has attempted to pay in domestic currency, but many of the bonds do not allow repayment in rubles.

As a result, Putin's government has had to turn to US dollars held in Russia to meet those payments -- an escape clause from default that is due to expire on May 25.

That expiry date is also two days before Russia's next debt service payment is due.

Yellen, speaking to journalists before a G7 meeting of finance ministers in Bonn, said a final decision has not been made, but she thought it is "unlikely" that the exemption would be renewed.

"Russia is not able right now to borrow in global financial markets. It has no access to capital markets. If Russia is unable to find a legal way to make these payments, and then they technically default on their debt, I don't think that really represents a significant change in Russia's situation," she said.
Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Israel Confirms Assassination of Quds Force Commander in Tehran
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
G7 Leaders Fail to Reach Consensus on Key Global Issues
Mass exodus in Tehran as millions try to flee following Trump’s evacuation order
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Netanyahu Signals Potential Regime Change in Iran
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
Energy Infrastructure Becomes War Zone in Middle East
Iran Conducts Ballistic Missile Launches Amid Heightened Tensions with Israel
Iran Signals Openness to Nuclear Negotiations Amid Ongoing Regional Tensions
Shock Within Iran’s Leadership: Khamenei’s Failed Plan to Launch 1,000 Missiles Against Israel
Trump's Anti-War Stance Tested Amid Israel-Iran Conflict
UK Deploys Jets to Middle East Amid Rising Tensions
Exiled Iranian Prince Reza Pahlavi Urges Overthrow of Khamenei Regime
Wreck of $17 Billion San José Galleon Identified Off Colombia After 300 Years
Iran Launches Extensive Missile Attack on Israel Following Israeli Strikes on Nuclear Sites
Israel Issues Ultimatum to Iran Over Potential Retaliation and Nuclear Facilities
Black Box Recovered from Air India Crash Site
Coinbase CEO Warns Bitcoin Could Supplant US Dollar Amid Mounting National Debt
Trump to Iran: Make a Deal — Sign or Die
Operation "Like a Lion": Israel Strikes Iran in Unprecedented Offensive
Israel Launches 'Operation Rising Lion' Targeting Iranian Nuclear and Military Sites
Israeli Forces Intercept Gaza-Bound Aid Vessel Carrying Greta Thunberg
IMF Warns of Severe Global Trade War Impacts on Emerging Markets
Syria to Reconnect to Global Economy After 14 Years of Isolation
Israel Confirms Arming Gaza Clan to Counter Hamas Influence
Global News Roundup: From Ukraine's strategic military strikes and Russia's demands and Tensions Escalate in Ukraine, to serious legal issues faced by Britons in Bali and Trump's media criticism, the latest developments highlight a turbulent landscape
U.S. Reduces Military Presence in Syria
Trump Demands Iran End All Uranium Enrichment in Nuclear Talks
Iran Warns Europe Against Politicizing UN Nuclear Report
Paris Saint-Germain's Greatest Triumph Is Football’s Lowest Point
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
European and Arab Ministers Convene in Madrid to Address Gaza Conflict
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
Trump Administration Cancels $100 Million in Federal Contracts with Harvard
SpaceX Starship Test Flight Ends in Failure, Mars Mission Timeline Uncertain
King Charles Affirms Canadian Sovereignty Amid U.S. Statehood Pressure
×