What is an Embargo?

//What is an Embargo?
What is an Embargo? 2017-10-04T07:08:35+00:00

Definition: Embargo is a policy that restricts or prohibits the free trade of goods and services between two countries. Usually, an embargo is the outcome of an unfavorable political, economic or environmental practice against a country.

What Does Embargo Mean?

What is the definition of embargo? An embargo can be exercised in the trade of consumer goods (trade embargo) or military goods (strategic embargo) seeking to isolate a country, thereby causing economic and political turmoil. Furthermore, a trade embargo has serious repercussions for the economy and the sovereignty of a country but also for the world as, usually, allied countries join forces to reduce threats to the international peace by imposing trade restrictions on the target country.

Let’s look at an example.


One of the most widely known embargoes in history is the embargo of the United States against Cuba. Following President Eisenhower’s decision to cancel the import of sugar from Cuba to the United States and stop the export of crude oil to Cuba, Fidel Castro’s government proceeded to the nationalization of American-owned oil refineries. On October 19, 1960, the United States responded with a commercial and economic embargo on Cuba, restricting it from importing U.S. goods except for food and medicine.

Two years later, the embargo was extended to all imports from the United States. In 1999, President Clinton imposed a restriction on the foreign subsidiaries of US companies to engage in trading activity with Cuba. Recently, on May 15. 2016, President Obama announced the relaxation of the embargo restrictions on Cuba, thereby allowing the two countries to exchange goods and facilitating the travel of American people to Cuba.

Another embargo that took place recently is the embargo sanctions imposed by the European Union to the Russian energy sector. More specifically, the EU banned major Russian energy companies – Gazpromneft, Transneft, and Rosneft – from raising long-term debt in the European capital markets, and restricted Russia from performing oil and gas explorations in the Arctic. The United States restricted American companies from engaging in trading activities with oil and gas drillers in Russia.

Summary Definition

Define Embargoes: Embargo means a trade restriction that makes it illegal for citizens or companies of one country to trade with those of another country.