Economy
US announces sweeping sanctions against Russia’s 2 largest oil firms
U.S. Treasury Secretary Scott Bessent on Wednesday unveiled new sanctions targeting Russia’s two largest oil companies, denouncing Moscow’s refusal to end its “senseless war” as Washington’s diplomatic push faltered and Ukraine sought more military support from allies.
The sanctions against Rosneft and Lukoil, as well as dozens of subsidiaries, followed months of bipartisan pressure on President Donald Trump to hit Russia with harder sanctions on its oil industry.
“Now is the time to stop the killing and for an immediate ceasefire,” Bessent said in a statement. Given Russian President Vladimir Putin’s “refusal to end this senseless war, the Treasury is sanctioning Russia’s two largest oil companies that fund the Kremlin’s war machine.”
Bessent said the Treasury Department was prepared to take further action if necessary to support Trump’s effort to end the war. “We encourage our allies to join us in and adhere to these sanctions.”
Bessent made the comments as NATO Secretary General Mark Rutte was in Washington for talks with Trump. The military alliance has been coordinating deliveries of weapons to Ukraine, many of them purchased from the United States by Canada and European countries.
The announcement came after Russian drones and missiles blasted sites across Ukraine, killing at least six people, including a woman and her two young daughters.
The attack came in waves from Tuesday night into Wednesday and targeted at least eight Ukrainian cities, as well as a village in the region of the capital, Kyiv, where a strike set fire to a house in which the mother and her 6-month-old and 12-year-old daughters were staying, regional head Mykola Kalashnyk said.
At least 29 people, including five children, were wounded in Kyiv, which appeared to be the main target, authorities said.
Russian drones also hit a kindergarten in Kharkiv, Ukraine’s second-largest city, later Wednesday when children were in the building, Mayor Ihor Terekhov said. One person was killed and six were hurt, but no children were physically harmed, he said.
Ukrainian President Volodymyr Zelenskyy said many of the children were in shock. He said the attack targeted 10 separate regions: Kyiv, Odesa, Chernihiv, Dnipropetrovsk, Kirovohrad, Poltava, Vinnytsia, Zaporizhzhia, Cherkasy and Sumy.
Russia fired 405 strike and decoy drones and 28 missiles, mainly targeting Kyiv, Ukraine’s air force said.
Trump’s efforts to end the war that started with Russia’s all-out invasion of its neighbor more than three years ago have failed to gain traction. Trump has repeatedly expressed frustration with Russian President Vladimir Putin’s refusal to budge from his conditions for a settlement after Ukraine offered a ceasefire and direct peace talks.
Trump said Tuesday that his plan for a swift meeting with Putin was on hold because he didn’t want it to be a “waste of time.” European leaders accused Putin of stalling.
Zelenskyy said Wednesday that Trump’s proposal to freeze the conflict where it stands on the front line “was a good compromise” – a step that could pave the way for negotiations.
Kremlin spokesman Dmitry Peskov said the planned summit requires careful preparation, suggesting that laying the groundwork could be protracted. “No one wants to waste time: neither President Trump nor President Putin,” he said.
In what appeared to be a public reminder of Russian atomic arsenals, Putin on Wednesday directed drills of the country’s strategic nuclear forces.
Zelenskyy urged the European Union, the United States and the Group of Seven industrialized nations to force Russia to the negotiating table. Pressure can be applied on Moscow “only through sanctions, long-range (missile) capabilities and coordinated diplomacy among all our partners,” he said.
More international economic sanctions on Russia are likely to be discussed Thursday at an EU summit in Brussels. On Friday, a meeting of the Coalition of the Willing – a group of 35 countries that support Ukraine – is to take place in London.
Zelenskyy credited Trump’s remarks that he was considering supplying Tomahawk missiles to Ukraine for Putin’s willingness to meet. The American president later said he was wary of tapping into the U.S. supply of Tomahawks over concerns about available stocks.
Russia has not made significant progress on the battlefield, where a war of attrition has taken a high toll on Russian infantry and Ukraine is short of manpower, military analysts say. Both sides have invested in long-range strike capabilities to hit rear areas.
The Ukrainian army’s general staff said its forces struck a chemical plant Tuesday night in Russia’s Bryansk region using British-made air-launched Storm Shadow missiles. The plant is an important part of the Russian military and industrial complex, producing gunpowder, explosives, missile fuel and ammunition, it said.
Russian officials in the region confirmed an attack but did not mention the plant.
Ukraine also claimed overnight strikes on the Saransk mechanical plant in Mordovia, Russia, which produces components for ammunition and mines, and the Makhachkala oil refinery in the Dagestan republic of Russia.
The Russian Defense Ministry said its air defenses downed 33 Ukrainian drones over several regions overnight, including the area around St. Petersburg. Eight airports temporarily suspended flights because of the attacks.
In other developments, Zelenskyy arrived Wednesday in Oslo, Norway, and after that flew to Stockholm, where he and Swedish Prime Minister Ulf Kristersson signed an agreement exploring the possibility of Ukraine buying up to 150 Swedish-made Gripen fighter jets over the next decade or more. Ukraine has already received American-made F-16s and French Mirages.
Moscow’s overnight attack also targeted energy infrastructure and caused rolling blackouts, officials said. Russia has been trying to cripple the country’s power grid before winter sets in.
“We heard a loud explosion and then the glass started to shatter, and then everything was caught up in a burst of fire. The embers were everywhere,” Olena Biriukova, who lives in a Kyiv apartment building, told The Associated Press.
“It was very scary for kids,” she said.
Two people were found dead in the Dnipro district of the Ukrainian capital, where emergency services rescued 10 people after a fire caused by drone debris hit the sixth floor of a 16-story residential building, local authorities said.
And in Kyiv’s Darnytskyi district, emergency services responded after drone debris hit a 17-story apartment block, causing a fire on five floors. Fifteen people were rescued, including two children.
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The global economic outlook hinges on how long the war in the Middle East lasts, with recession in some countries and sharply higher inflation a real possibility if it drags on into next year, the Organisation for Economic Co-operation and Development (OECD) warned on Wednesday.
If the conflict proves short-lived, Gulf oil and gas production could gradually return to pre-crisis levels from the third quarter with shortages confined to Asia and cushioned by strategic reserves and shipments from other producers.
In that baseline scenario, global growth is projected to slow from 3.4% in 2025 to 2.8% in 2026 before picking up to 3.1% in 2027, broadly in line with the OECD’s March forecasts.
In its previous economic outlook, the group of 38 industrialized countries had forecast 2026 global growth of 2.9%.
“The longer the disruption lasts, the greater the economic, but also the social cost of this crisis, and it certainly will make policy changes much more difficult,” OECD chief economist Stefano Scarpetta told a press conference.
If energy disruption persists well into next year, global growth could slow sharply to 2.1% in 2026 and 1.8% in 2027 – rates rarely seen outside major crises such as the 2008 to 2009 financial crash or the COVID-19 pandemic.
Some economies could fall into outright recession, with Asian countries reliant on Middle East energy supplies expected to be hit hardest.
In the protracted disruption scenario, higher energy prices could add 0.4 percentage points to global inflation in 2026 and 1.3 percentage points in 2027, likely prompting central banks to hike interest rates by 0.5 to 0.75 percentage points in the short term.
In the baseline scenario, the OECD forecast that inflation across G-20 economies would peak at 4% this year before slowing to 3.1% next year with interest rates largely on hold this year and cuts expected next year.
“Around one-third of OECD economies are projected to experience negative real wage growth this year. Workers in these countries will see their living standards fall, which is the human reality behind the inflation numbers,” OECD Secretary-General Mathias Cormann said.
Global trade growth is set to moderate following a strong 2025, though robust demand for AI-related goods and investment, especially in Asia, should provide some support.
Uneven outlooks
In the baseline scenario, stronger energy exports are expected to support U.S. growth, partly offsetting the drag from higher prices on household purchasing power. Growth is projected to ease from 2.1% in 2025 to 2.0% in 2026 and 1.8% in 2027.
In Europe, eurozone growth was seen slowing from 1.4% to 0.8% this year before rising to 1.2% next year as resilient labor markets and higher defense spending help offset government belt-tightening.
In Britain, growth is projected to slow to 0.9% this year before recovering to 1.1% in 2027 as global trade stabilizes and financial conditions ease.
In Asia, China was seen slowing from 5.0% growth in 2025 to 4.5% in 2026 and 4.3% in 2027 with ample energy reserves limiting exposure to oil price spikes. Exports are set to benefit from lower U.S. tariffs and a competitive tech sector, although a property slump remains a drag.
Japan is expected to be among the hardest-hit by trade disruptions linked to the Gulf conflict, with growth slowing from 1.1% in 2025 to 0.6% in 2026 before edging up to 0.8% in 2027, a downgrade from March.
While subsidies will help cushion the energy shock, the OECD said Japan needs a “clear and credible” plan to rein in public finances over the medium term as interest rates rise.
Türkiye forecasts
The Paris-based organization also trimmed its 2026 growth forecast for Türkiye, citing weaker domestic demand amid high energy and commodity prices and tighter financial conditions, while leaving its 2027 outlook unchanged.
OECD cut its 2026 projection to 3.1% from 3.3% in March, and expects growth to rise to 3.8% in 2027.
“After some initial weakness in the first half of 2026, domestic demand is expected to pick up once the economic fallout from the Middle East conflict diminishes,” it noted.
As a net importer of energy and fertilizers, Türkiye remains exposed to higher prices, which will continue to weigh on inflation and the current account, and in turn could trigger currency depreciation and boost imported inflation, it added.
The OECD stressed that bringing inflation down remains the policy priority and requires sustained tight macroeconomic settings.
“Achieving rapid disinflation will require continuously tight monetary policy,” it said.
After easing earlier in the year, disinflation is expected to regain pace in the second half of 2026 and through 2027.
Consumer prices rose almost 4.2% month-over-month and nearly 32.4% on an annual basis in April, mainly driven by Iran war-linked pricing pressures.
According to OECD, headline inflation is projected to fall to 15% year-over-year by the end of 2027, supporting stronger private consumption and lifting growth.
Upside risks persist, including high energy prices and rising inflation expectations if policy action lags.
The OECD sees the interest rates likely remaining on hold amid high commodity prices, before decreasing to 20% by the end of next year.
At its last meeting, the Central Bank of the Republic of Türkiye (CBRT) held its benchmark one-week repo rate steady at 37%.
The bank said geopolitical risks and energy price volatility continued to pose uncertainty for inflation.
Separately on Wednesday, the European Bank for Reconstruction and Development (EBRD) cut its Türkiye growth forecast to 3.5% from 4% for 2026 and to 4% from 4.5% for 2027.
The EBRD cited rising energy imports, persistent inflationary pressures and Iran war spillover risks on tourism and manufacturing supply chains.
“Disinflation is costly and acts as a brake on the economy, but the cost of not addressing inflation would be much higher,” EBRD chief economist Beata Javorcik said.
Türkiye eyes reaching $30 billion in annual trade volume with France by 2030, a senior official said on Wednesday during a two-day visit to the European country.
“In the past five years, Türkiye-France trade has increased by 71%, from $14 billion to $24.2 billion. At this rate, we could surpass $25 billion this year. Our goal is to reach a total trade volume of $30 billion by 2030,” Trade Minister Ömer Bolat said.
Bolat arrived in the French capital, Paris, on Tuesday for a two-day visit to France.
In Paris, Bolat met with members of the major French business association, MEDEF, and the World Turkish Business Council (DTIK) France members. He also had a bilateral meeting with Nicolas Forissier, the current Minister Delegate for Foreign Trade and Economic Attractiveness of France.
The minister was also expected to attend the Ministerial Council Meeting organized by the Organization for Economic Cooperation and Development (OECD) on Wednesday.
Speaking to Anadolu Agency (AA), Bolat said that the meetings they held in Paris were productive, touching upon the contacts with Turkish businesspeople in the country and in general Türkiye-France relations.
Drawing attention to the fact that there are about 800,000 Turkish citizens in France, Bolat said that France is the second country in the world with the largest Turkish diaspora.
“Therefore, the successes of Turks in France in education, arts, labor, business, services, industry, and transportation make us proud. As the government, we support them and stand by them for even greater achievements. We are genuinely and wholeheartedly interested in their issues,” he noted.
Bolat also mentioned that the meeting with MEDEF was attended by top executives of around 24 French companies that have invested in Türkiye, and continued: “We explained the potential for development in Türkiye-France relations and economic (potential). At the same time, we talked about Türkiye-European Union relations, debates on ‘Made in EU’, and how economic integration between Türkiye and the EU can be much stronger in general. They agree with us on this.”
Moreover, he suggested that the Customs Union between Türkiye and the European Union has created very strong and close ties between the economies and industries of the two countries, providing significant mutual integration and contribution. He added that they discussed the “Made in EU” topic with Forissier.
Moreover, he pointed out that the European Commission’s decision on March 4 to include Türkiye within the scope of “Made in EU” was very important and gratifying news.
President Recep Tayyip Erdoğan said on Wednesday that the Middle East conflict and its fallout have reinforced Türkiye’s strategic importance in global energy supply.
Speaking at the inauguration ceremony for renewable energy projects completed in 2025, Erdoğan highlighted the country’s role as a regional energy hub and transit corridor.
Over three months into the war that started after the U.S. and Israel launched strikes on Iran, the world is facing a vast economic pain due to the severe disruption of energy supplies and other shipping.
A shaky cease-fire agreed in April still stands, but diplomacy to halt the conflict and reopen the Strait of Hormuz, a route that handled roughly a fifth of global oil and liquefied natural gas shipments before the war, is showing little sign of progress.
Erdoğan said recent developments had reaffirmed the significance of energy security for national economies and sovereignty. The crisis has “cemented Türkiye’s critical role in the global energy supply,” he noted, stressing that the impact of the war would continue to be felt.
Energy hub and crossroads
The effective closure of the Strait of Hormuz has caused what the International Energy Agency (IEA) says is the biggest energy supply disruption ever. Gulf oil producers have lost around 14 million barrels per day (bpd) of supply since the end of February.
On Tuesday, IEA warned that global oil inventories could hit critical levels ahead of the peak summer demand period if stock draws continue at their current pace.
Erdoğan said the conflict drove up prices of everything from oil, gas and LNG to petroleum-derived products, including fertilizers and plastics, while various restrictions implemented to curb energy consumption recalled the days of the COVID-19 pandemic.
“Türkiye’s role as a regional energy hub and crossroads is growing stronger by the day. It is very clear, especially in light of recent developments, that Türkiye is the region’s key player in the energy sector,” said Erdoğan.
He described energy supply security as not only a development issue but also a matter of sovereignty and national security, adding that the experiences of both the Russia-Ukraine war and the Hormuz crisis had underscored the need for diversified and secure energy sources.
The president said growing industrialization, urbanization and technological development would continue to increase global energy demand, pointing to projections that electricity consumption by AI-focused data centers could double within five years.
Türkiye’s electricity consumption rose 2.1% in 2025 from a year earlier, while demand is expected to increase by at least 50% by 2035.
Renewable ambitions
Erdoğan reiterated Ankara’s goal of reducing dependence on imported energy through greater use of domestic and renewable resources.
Imported sources currently account for about 57% of Türkiye’s energy supply. Its annual energy import bill stands at around $60 billion.
Türkiye currently ranks fifth in Europe and 11th globally in renewable energy installed capacity.
Under the National Energy Plan covering 2020-2035, Ankara aims to increase combined solar and wind power capacity from 40 gigawatts (GW) at the end of 2025 to 120 GW by 2035.
The expansion will require investments of around $80 billion and include the construction of a green transmission infrastructure to integrate additional renewable energy into the grid, Erdoğan said.
Plans also include development of 5 GW of offshore wind capacity by 2035.
Erdoğan said Türkiye’s total installed electricity capacity reached 125,410 megawatts (MW) by the end of April, with renewables accounting for 62.5% of the total. Solar power alone contributed 26,770 MW.
Renewable sources generated 43.3% of Türkiye’s electricity output by the end of 2025, up from 24% in 2005, when total electricity generation stood at 162 terawatt-hours (TWh). Total generation is expected to reach 363 TWh this year.
The president said 7,110 power plants entered service in 2025, representing investments of approximately $5.6 billion and adding 8,313 MW of installed capacity. Solar projects accounted for 6,063 MW and wind projects for 1,946 MW.
That marks a new record after $5 billion worth of 6,818 MW of installed capacity was added in 2024, said Energy and Natural Resources Minister Alparslan Bayraktar.
The new facilities are expected to generate 7.3 TWh annually and help avoid the need for 3.5 billion cubic meters of natural gas imports, saving an estimated $1.8 billion per year, Erdoğan said.
“We have avoided such a bill thanks to the investments we put into service today.”
Türkiye has launched investigations into seven companies over allegations that they used automated software to secure Schengen visa appointments and resell them for profit, media reports said on Wednesday.
The issue has also become a topic of debate in Parliament, where lawmakers submitted questions regarding claims that visa appointments were being collected through bots and sold commercially.
Responding to inquiries, Trade Minister Ömer Bolat said Türkiye’s Advertising Authority had opened reviews into seven separate companies, according to the NTV broadcaster.
Authorities had received 143 complaints through the Presidential Communication Center (CIMER) and 10 applications via the e-Government platform concerning visa intermediary services over the past five years, Bolat said.
According to Bolat, complaints involving payments made to personal bank accounts through IBAN transfers and allegations of invoices not being issued have also been referred to the Treasury and Finance Ministry and the Foreign Ministry for further examination.
Last week, top tourism body said Turkish applicants were being effectively “shut out” of the Schengen visa application system, citing persistent appointment shortages and alleged technical manipulation of booking platforms.
Latest statistics showed Türkiye was the second-largest source of Schengen visa applications worldwide in 2025.
Applications to Schengen Area countries reached 11.93 million last year, an increase of 1.8% from 2024, according to European Commission.
Türkiye accounted for nearly 1.27 million applications, ranking second after China. The figure compared to 1.17 million in 2024 and just over 1 million in 2023.
The rejection rate for Turkish applicants stood at 14.6% last year, up 0.1 percentage points from 2024.
For years, Turkish citizens and businesses have complained about the EU’s visa system, including long appointment wait times, the issuance of very short-term visas and high rejection rates.
Turkish Travel Agencies Association (TÜRSAB) on Friday claimed that the appointment system is being exploited, alleging that limited time slots were rapidly captured by automated bot accounts and later resold at significantly higher prices.
Bolat said are currently no specific consumer protection regulations governing the pricing, refund policies or disclosure obligations of companies providing visa application intermediary services. He said authorities are evaluating whether additional regulatory measures are needed in consultation with relevant institutions.
Complaints over limited availability and the emergence of a black market for appointments have intensified in recent years.
Appointments are said to be obtained through unofficial channels and resold for between 300 euros and 500 euros, with prices reportedly reaching as high as 1,000 euros in urgent cases, TÜRSAB chair Firuz Bağlıkaya said.
Bağlıkaya said the shortage of visa appointments was preventing many Turkish citizens from even submitting applications.
“Limited appointments are opened unexpectedly, often late at night, on holidays or weekends, and are quickly blocked by bots,” he said, adding that the appointments are subsequently offered for sale at inflated prices.
Bağlıkaya said the European Commission data has “proven us right,” citing statistics that showed the number of Turks who were able to apply for a visa to Italy declined by 32.3%, while the number of applications to France also decreased by nearly 6%.
“These declines are the clearest indication that our citizens have been unable to find visa appointments,” he noted.
The debate has also drawn international attention.
An investigation coordinated by the global journalism network Lighthouse Reports and conducted with 14 media organizations across 12 countries examined the operations of a major visa outsourcing company with more than 4,100 centers in 168 countries.
The report alleged that applicants were pressured into purchasing unnecessary add-on services, including SMS notifications, VIP lounge access and premium packages. It also raised concerns about data protection practices, appointment hoarding through automated systems, document handling errors and inadequate staff training.
According to the investigation, some visa appointments allegedly secured through bots were resold on secondary markets via travel agencies, while certain corruption allegations were reportedly not disclosed to contracting governments despite contractual obligations.
The Trump administration has brought up a proposal for new tariffs of 10% and 12.5% on imports from 60 trading partners after it said it determined that they failed to curb trade in goods made with forced labor, a finding described by a senior EU lawmaker as “utterly absurd.”
The proposal from the U.S. Trade Representative’s (USTR) office, issued late on Tuesday, comes from a Section 301 unfair trade practices investigation designed to help rebuild U.S. President Donald Trump’s emergency tariffs, which were struck down by a U.S. Supreme Court decision in February.
The USTR proposed 10% additional duties on imports from Canada, Ecuador, the European Union, Indonesia, Mexico, Pakistan, Argentina, Bangladesh, Cambodia, El Salvador, Guatemala, Malaysia, Taiwan, and Britain. The USTR said all had plans or partial schemes in place.
The trade agency also said it would impose additional duties of 12.5% on the remaining 45 countries that it investigated. These include China, India, Nigeria, Japan, South Korea, Australia and New Zealand.
“The failure of our most important trading partners to address the importation of goods made with forced labor is unacceptable,” U.S. Trade Representative Jamieson Greer said in a statement.
“This creates a dynamic where American workers are forced to compete globally on an unlevel playing field.”
The USTR said it was also proposing a textile mechanism that would allow for a certain volume of apparel and textile imports to enter the U.S. at a reduced tariff rate, though the duties and volumes were not disclosed.
Europe says new tariffs are unjustified
The announcement comes ahead of the July 24 expiration of a 10% temporary tariff imposed by the Trump administration on Feb. 20, the day the Supreme Court struck down Trump’s tariffs under the International Emergency Economic Powers Act (IEEPA).
The European Commission said the tariffs were unjustified and reiterated its commitment to the trade deal sealed with Washington last year.
Bernd Lange, the chair of the European Parliament’s trade committee, which voted on Tuesday to accept that trade deal, said the new tariffs were expected, but said the findings were still “utterly absurd” given a 2024 EU law to ban imports of forced labor products.
“The impression is increasingly emerging that a tariff measure is sought first, and only then is a suitable legal justification found,” he said. However, he added that the key question would be whether the additional tariffs would exceed those agreed between both sides last July.
The United States’ largest trading partner, the European Union, agreed last July to accept U.S. tariffs of 15% on a broad range of its exports.
In its report, the USTR said the EU measures only came into force in December 2027 and lacked certain key elements. Taiwan said it was “hopeful and confident” that the final results would reflect agreements already reached, securing relatively preferential treatment.
Beijing, facing 12.5% tariffs, said that it opposed all forms of unilateral tariffs and that there was no forced labor in China.
India, confronted with the same rate, said it was engaged with Washington on the Section 301 proceedings, noting the proposed tariffs were not final.
Earlier on Monday, the USTR proposed a 25% duty on many Brazilian goods as a result of a Section 301 investigation into the country’s digital trade practices and preferential tariffs.
The trade agency is also expected to soon unveil the findings of another major Section 301 probe into the buildup of excess industrial capacity in 16 trading partners, including China and the European Union.
In the forced labor findings, the USTR said it would exempt from the tariffs a number of products including energy, rare earths and some other metals, beef, coffee, certain fruits and vegetables, pharmaceuticals, organic chemicals and aircraft parts.
The USTR said it would accept public comments on the proposed tariffs and other remedies through July 6, with a public hearing scheduled for July 7.
Türkiye’s Personal Data Protection Authority (KVKK) has ruled that employers cannot use biometric data to monitor employees’ attendance, saying the practice violates the country’s personal data protection legislation.
According to a principle decision published in the Official Gazette on Tuesday, the KVKK determined that processing employees’ biometric data for attendance tracking purposes cannot be justified under legal provisions, even if workers provide explicit consent.
The board said attendance monitoring systems based on biometric identifiers, including fingerprints, retina scans, facial and hand geometry, and voice characteristics, are incompatible with the principles of the Law on the Protection of Personal Data.
The ruling emphasized that employers should instead use less intrusive methods to track attendance, such as password-protected cards, PIN-based systems, traditional signature logs, paper attendance sheets, RFID or NFC identity cards, or manual registration under supervisory oversight.
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