US sanctions Russian oil companies as Moscow holds nuclear drills

The new sanctions were unveiled one day after plans for a summit between U.S. President Donald Trump and Russian President Vladimir Putin fell apart. Trump told reporters he cancelled the meeting because "it didn't feel right to me."

The U.S. Treasury Department said Russia's two largest oil companies, Rosneft and Lukoil, were targeted in a bid to damage Moscow's ability to fund its war machine.

The move marked a sharp turnaround for the White House, which has veered between pressuring Moscow and taking a more conciliatory approach aimed at securing peace in Ukraine. Only last week Trump appeared ready to hold off on new actions targeting Moscow.

"Now is the time to stop the killing and for an immediate ceasefire," U.S. Treasury Secretary Scott Bessent said. Oil prices extended gains after Bessent's comments, rising by more than $2 a barrel.

For months, Trump has resisted pressure from U.S. lawmakers to impose energy sanctions, hoping that Putin would agree to end the fighting. But with no end in sight, he said he felt it was time.

Trump said he was still not ready to provide Ukraine with long-range Tomahawk missiles, which Kyiv has requested. Talking to reporters as he met NATO Secretary General Mark Rutte, Trump said it would take the Ukrainians at least six months to learn how to use them.

Ahead of a meeting next week with Chinese President Xi Jinping in South Korea, Trump said he would like to see Xi use his influence on Putin to halt the fighting. Xi and Putin have formed a strategic alliance between their countries.

In a fresh show of force, the Kremlin released video showing General Valery Gerasimov, head of the General Staff, reporting to Putin on the drills. Russia said it fired missiles from ground launchers, submarines and aircraft, including intercontinental ballistic weapons capable of striking the United States.

Russia's Defence Ministry said its long-range Tu-22M3 strategic bombers flew over the Baltic Sea, escorted at various points by fighter jets from foreign - presumably NATO - states.

At key moments in the war in Ukraine, Putin has issued reminders of Russia's nuclear might as a warning to Kyiv and its Western allies. NATO has also been conducting nuclear deterrence exercises this month.

EU countries also approved a 19th package of sanctions against Russia for its war against Ukraine, which includes a ban on Russian liquefied natural gas imports, the Danish rotating presidency of the EU said on Wednesday.

The Wall Street Journal said the United States lifted a restriction on Ukraine's use of some long-range missiles provided by Western allies, which would allow Ukraine to increase attacks on targets inside Russia. In a social media post, Trump denied the report.

On Wednesday, Sweden said it had signed a letter of intent to export Gripen fighter jets to Ukraine, as European governments act to boost Kyiv's defences in a war that has ground on for three years and eight months since Russia's full-scale invasion, and shows no sign of ending soon.

Ukrainian pilots have been in Sweden to test the Gripen, a rugged and relatively low-cost option compared to aircraft such as the U.S. F-35.

Kyiv aimed to receive and start using Gripens next year and expected to acquire at least 100, President Volodymyr Zelenskiy said during a visit to Swedish defence manufacturer Saab SAABb.ST.

TRUMP DOESN'T WANT WASTED MEETING

Russia and Ukraine pounded each other with heavy overnight missile attacks as renewed uncertainty enveloped the U.S.-led peace effort.

After months of stalled diplomacy, Putin and Trump spoke last week and unexpectedly announced they would hold a summit in Hungary soon.

But following a phone call on Monday between the two countries' top diplomats, the White House said the next day that Trump had no plans to meet Putin "in the immediate future". Trump said he did not want to have a wasted meeting - something the Kremlin said Putin also wanted to avoid.

U.S. Secretary of State Marco Rubio, departing Washington for the Middle East on Wednesday, told reporters the United States would still like to meet with Russia.

Russian officials said that preparations continued for a summit. "The dates haven't been set yet, but thorough preparation is needed before then, and that takes time," Kremlin spokesperson Dmitry Peskov told reporters.

The summit delay came after Russia reiterated to the U.S. its previous terms for reaching a peace deal, including that Ukraine cede control of the whole of the southeastern Donbas region, three sources told Reuters.

That amounted to a rejection of Trump's statement last week that both sides should stop at the current front lines.

Russian Deputy Foreign Minister Sergei Ryabkov was quoted by state news agency RIA as saying he could not confirm that Moscow had conveyed its position as reported by Reuters.

SHARES IN EUROPEAN DEFENCE COMPANIES RISE

Through the first nine months of his second term, Trump has pressed for an end to the conflict, the deadliest in Europe since World War Two.

Sharply critical at times of Zelenskiy, he has also expressed frustration with Putin.

European defence shares rose on the delay to the Putin-Trump summit. Most European governments strongly back Kyiv and have pledged to raise military spending to help Ukraine meet its defence needs.

European Union leaders are due on Thursday to discuss a proposal to use frozen Russian assets to extend a $163 billion loan to Ukraine. Moscow says the scheme amounts to theft and has vowed to retaliate.