Editor's Note: In the coming year, RANE will analyze the geopolitics of natural resources and raw materials. This series will be published periodically throughout the remainder of 2026; you can find all parts here.
In recent years, rising geopolitical tensions and competition among major powers have made countries more inclined to exploit other countries' economic dependence, whether through trade restrictions or financial sanctions. Weaponizing another country's dependence on critical commodity imports is a particularly effective way to impose, or threaten to impose, costs on another country. This is because, under propitious circumstances, the decline in export-related revenues due to export restrictions tends to be minimal compared to the economic and political costs faced by the target country, such as its ability to sustain economic growth or activity in sectors deemed critical from a national security or technology perspective.
Geopolitical imperatives increasingly outweigh the economic benefits of cooperation, eroding the post-World War II international order. Consequently, foreign economic policy today focuses less on mutual benefits like comparative advantage and more on the political exploitability of interdependence — specifically, the ability of a less vulnerable country to impose asymmetric costs on a more vulnerable one.
Washington's Embargo Against Japan in the Early 1940s
Economic interdependence can be leveraged or weaponized in many ways. A country can impose tariffs on another country to slow its economic growth. A country can also restrict exports of industrial goods, services and commodities to another country, which is particularly effective if the targeted country has few alternative sources or must pay much higher prices elsewhere.
Perhaps the most famous example of such commodity-related export restrictions was the U.S. embargo against Japan, which directly led Japan to attack the United States. The United States opposed Japan's foreign policy, particularly with respect to China, and its broader expansionist strategy in East and Southeast Asia. Before Japan entered World War II, it was dangerously dependent on the United States, importing 74% of its scrap iron and approximately 80% of its oil from American sources. In 1940, the United States imposed a gradual tightening of export controls on scrap iron and steel. In addition to freezing Japanese financial assets in 1941, the United States instituted a total embargo on oil and gasoline exports to Japan. Without this supply, the Imperial Japanese Navy estimated it had only 18 to 24 months of fuel remaining.
This transformed a trade dispute into an existential crisis for Japan. To secure new oil sources in the Dutch East Indies (present-day Indonesia), Japan concluded that it first had to neutralize the U.S. Pacific Fleet, which directly led to the attack on Pearl Harbor in 1941. If U.S. weaponization of commodity exports was meant to deter Japan, it badly backfired. If the measures were meant to force Japan into an even more expansionary policy and generate domestic political support in the United States to oppose Japan with military, not just economic means, they succeeded. Historians continue to disagree about what Washington's intent was.
Arab Oil Embargoes of the 1960s and 1970s
Perhaps the economically most impactful weaponization of commodity exports was the two Arab oil embargoes during the Arab-Israeli conflicts of the late 1960s and early 1970s — especially the second. In 1967, following the conclusion of the Six-Day War, a coalition of Arab states made up of Saudi Arabia, Kuwait, Iraq, Libya and Algeria stopped all oil shipments to the United States, the United Kingdom and West Germany. The impact of this measure was significantly mitigated by the substantial spare capacity (the ability to rapidly increase domestic production) still held by the United States at that time. Furthermore, non-Arab producers, such as Venezuela and Iran, compensated for the shortfall, and the embargo was lifted after merely three months.
During the 1973 Yom Kippur War, however, the Arab members of OPEC implemented production cuts and a complete ban on exports to nations supporting Israel. The consequence was a fourfold increase in global oil prices and a period of high inflation and low economic growth or outright recession, known as stagflation, in many countries. The S&P 500 fell by almost half and the episode led to the end of the "cheap-energy" era, which weighed on the economic outlook of energy-intensive industrial countries for at least a decade. Oil exporters benefited from a significant transfer of wealth via more favorable terms of trade. The Latin American debt crisis was also indirectly the consequence of the oil embargo, as oil exporters' increased savings led to excessive investment in developing economies in Latin America and elsewhere.
Geopolitically, European countries and Japan, both dependent on Arab oil for nearly 80% of their energy, began to distance themselves from the United States' Middle East policy and moved toward a more "pro-Arab" or at least neutral stance to secure their energy lifelines. Therefore, weaponization was politically somewhat successful from the Arab oil-exporting countries' point of view, even though it failed to compel the United States to withdraw support from Israel. Less arguable is the fact that many Arab oil-exporting countries, such as Saudi Arabia, became very wealthy and better positioned to become geopolitical actors in their own right.
Chinese Rare Earth Export Restrictions in 2025 and 2026
The most recent prominent example of weaponizing commodity exports occurred in the context of the so-called trade war between the United States and China. After a rapid escalation of a bilateral trade conflict starting in February 2025, leading to very high tariffs, China imposed restrictions on the export of critical minerals, essential in the production of important defense and technology goods, to the United States. China is estimated to control about 70% of global mining and upwards of 90% of global refining and separation capacity of these minerals. China's near-monopoly, particularly in terms of refining, provides Beijing with a significant ability to exploit America's dependence on these commodities.
As the export ban threatened to lead to a standstill of production in important U.S. economic sectors, such as automobiles, U.S. President Donald Trump's administration agreed to a trade truce. Thus, China's export control policy facilitated economic de-escalation, as the Trump administration subsequently withdrew its tariffs and agreed to negotiate a comprehensive trade agreement with China. Unlike the embargoes on Japan 85 years earlier, export restrictions on critical commodities resulted in a reduction of direct economic conflict.
Potential Weaponization of Commodity Exports During the Russia-Ukraine War
While not strictly speaking an example of weaponization of commodity exports, ongoing Western and European efforts to impose sanctions on Russia are closely related to the conditions that undergird weaponization. In this instance, European countries' commodity dependence on Russian energy imports limited their ability to rapidly impose wide-ranging sanctions on Russia.
The European Union's dependence on Russia was primarily characterized by its reliance on natural gas, crude oil and coal imports. While crude oil represented the largest import in terms of both volume and total value, natural gas constituted the most critical strategic dependency due to its inextricable link to fixed pipeline infrastructure, which significantly complicated the process of replacement. Unlike oil, mostly transported globally via tanker, gas was primarily delivered from Russia to the European Union through extensive, fixed pipelines, essentially rendering Europe a "captive customer." Nearly 50% of the gas, 46% of the coal, 27% of the crude oil and 30% of refined petroleum products originally consumed in the European Union originated from Russia. However, both coal and oil can be purchased on liquid global markets, offering substitutability, though generally at higher prices. The European Union has since successfully transitioned from a high-dependency model to a diversified "global buyer" model.
Although Russia derives significant revenues from energy exports, Europe was constrained in terms of limiting Russian energy for fear of negative economic consequences. This dependence also partially weakened support for economic measures targeting Russia at both the member-state and European levels, where individual member states can often utilize their vote to obstruct sanctions decisions that require unanimity. Moreover, had Russia weaponized energy exports by limiting the amount of energy commodities it was sending to Europe, it would have incurred costs. But Europe was more concerned about such a move, and this helped Moscow buy time and find alternative buyers to help sustain its commodity-related revenues. It may also have helped Russia deter more forceful sanctions. While Russia did not make use of large-scale export restrictions, its ability to do so played to its advantage.
Lessons of History
The economic and geopolitical context for each of these examples varied greatly. The economic leverage that the sender (sanctioning) country had over the target (sanctioned) country also varied, although in practice, it is difficult to precisely quantify it. Nonetheless, U.S. weaponization of oil exports to Japan backfired and directly led to the outbreak of the Pacific War. While Arab oil exporters' ability to leverage exports did not compel the United States to withdraw its support for Israel, it was somewhat successful in shifting Europe and Japan's foreign policy toward a more neutral stance. Russia's ability to weaponize exports was also moderately successful in delaying broader sanctions being imposed on Moscow.
By comparison, China's weaponization of rare earth exports was highly successful in forcing America to back down on its maximalist trade demands. While export controls were very effective in deflecting U.S. pressure, they have also intensified efforts by the United States and other countries to reduce their dependence on Chinese-controlled critical mineral supply chains. However, it will be many years before the United States is able to significantly reduce its reliance on China, given the amount of time needed for investment in mining and refining to translate into increased production. This means that China is well-positioned to exploit other countries' dependence on its critical mineral exports for the foreseeable future.
All of the above examples also demonstrate that the countries targeted by critical commodity export restrictions quickly moved to reduce their dependence. Japan expanded its territorial control of Southeast Asia. The United States and European countries established strategic petroleum reserves, among other measures. The United States has launched an investment drive to gain access to critical commodities through investment and international agreements. European countries were quick to diversify their energy imports to replace lost Russian imports.
This then helps explain the ongoing efforts made by many countries to reduce critical supply chain dependencies. Efforts are targeted at dependencies on geopolitical antagonists, but increasingly also at the mitigation of vulnerabilities vis-a-vis allies. Europe is particularly worried about the Trump administration exploiting Europe's economic dependencies. It fears, for example, being cut off from U.S. exports of liquefied natural gas and technology exports. Europe is concerned that the Trump administration will take a largely unilateral approach to making its critical supply chains more resilient, leading to increased competition for access to mineral deposits and refining capacity. After all, the United States is strongly focused on reducing supply chain risks, as articulated in its recent National Security and National Defense Strategies.
However, there are also signs that international cooperation to mitigate critical mineral vulnerabilities remains on the table. In December 2025, Washington launched Pax Silica, an international initiative with several close allies, including Japan, South Korea, Singapore and the United Kingdom (but not the European Union, which holds an observer status), aimed at boosting the resilience of critical mineral supply chains.
China, the European Union, the United States and other countries such as Australia have introduced initiatives to strengthen the security of their supply chains — particularly for critical minerals — by diversifying sources through trade and investment deals, promoting onshoring and reindustrialization and implementing national stockpiling policies. In May 2024, the European Union's Critical Raw Materials Act entered into force. In December 2025, the European Union launched the Resource EU plan to reduce the bloc's dependence on critical mineral imports by supporting investment, fast-tracking permitting and launching strategic partnerships with countries like South Africa. The United States is pursuing similar policies.
Countries face a tradeoff when it comes to mitigation policies. Exclusively unilateral policies aimed at mitigating critical commodity dependence will drive up the costs of mitigation, but if well-designed, will reduce the ability of other countries to weaponize commodity dependence. Meanwhile, international cooperation can reduce the costs of mitigation policies, but cooperation breaking down will again leave countries vulnerable to weaponization.
