The United States is re-evaluating the strictest elements of a ban on Russian diamonds from the Group of Seven major democracies, after opposition from African countries, Indian gem polishers and New York jewellers, seven sources said.
The sanctions package, agreed in December and including a ban across the European Union, represents one of the industry's biggest shakeups in decades.
Two of the sources familiar with the negotiations said the Americans had disconnected from G7 working groups on the stringent controls, with one describing them as "there but not engaging".
The U.S. State Department declined to comment.
A senior Biden administration official said Washington had not changed its position and that the United States would keep working with the G7.
"We will want to make sure that we strike the right balance between hurting Russia and making sure that everything is implementable," said the official who declined to be named because they were not authorised to speak publicly on the negotiations.
The G7 sanctions aim to hit another stream of revenue for the Kremlin's war effort in Ukraine, even though at around $3.5 billion, according to Russian state-run miner Alrosa's 2023 results, diamonds represent a small fraction of the profits Moscow earns from oil and gas.
Since March, importers to G7 countries must self-certify that diamonds do not originate from Russia, the world's leading producer of rough diamonds. Sanctions were imposed on direct imports of Russian gems in January.
From September, the EU ban will require diamonds of 0.5 carats and above to pass through Antwerp, a centuries-old diamond hub in Belgium, for traceability certification using blockchain - the digital ledger used by cryptocurrencies.
Sources said G7 powers had agreed that Antwerp would be the logical first hub, with others to be added later.
But three of the sources said Washington had cooled on enforcing traceability and that discussions on implementing tracing had stalled.
The Biden administration official said the commitment to implementing a traceability mechanism by Sept. 1 applied to the European Union, not the United States, citing the language in a G7 leaders' statement in December.
"We need to do this in a way that takes into account concerns from African partners and African producers, takes into account Indian and UAE partners ... and makes sure we can also make it workable for U.S. industry," said the official.
"Is there a traceability mechanism that satisfies all of that? We haven't walked away from the idea... on the other hand, we couldn't sign up to definitely having this in place by Sept. 1st."
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