Due to the escalation of the war, Western countries promised support to Ukraine, and additional pressure to Russia.
The European Union and the G7 countries have begun discussing new sanctions against Russia over its announcement of mobilization for war against Ukraine and after Russian ruler Vladimir Putin’s statements about plans to annex occupied territories of Ukraine and threats of nuclear weapons. The mass media write that the sanctions may affect oil, diamonds and the IT sphere. Correspondent.net tells the details.
“The Kremlin has put the Russian economy on the path to oblivion”
European Union countries intend to “as soon as possible” introduce new sanctions against Russia due to the planned pseudo-referendums in the occupied territories of Ukraine, the head of European diplomacy, Josep Borrell, said on Thursday.
“Additional restrictive measures against Russia will be introduced immediately, as soon as possible in coordination with our partners. We will continue to support Ukraine’s efforts by supplying military equipment to the extent necessary,” Borrell said following the meeting of EU foreign ministers on the sidelines of the UN General Assembly.
Sanctions will be both personal and sectoral. According to Borrell, it is planned to include representatives of the Russian leadership, as well as persons involved in the preparation of pseudo-referendums, in the list of sanctions. The diplomat did not specify which sanctions are in question, noting that they have unanimous support and will affect the most important sectors of the economy.
The head of European diplomacy also noted that Putin’s address, in which he announced mobilization and threatened nuclear weapons, shows panic and despair. “It is obvious that Putin is trying to destroy Ukraine,” Borrell said.
Speaking at Princeton University at that time, European Commission President Ursula von der Leyen said that sanctions against Russia are effective.
“If you look at the financial sector in Russia, you will see that it is currently on artificial life support. Russian industry is in ruins. It is very interesting to look at the military complex … There are no spare parts. So now you can see how the Russians are “cannibalizing” their refrigerators and dishwashers to get semiconductors that they can use for the military complex. The Kremlin has put the Russian economy into oblivion,” said Ursula von der Leyen.
On September 23, after a meeting in New York, the foreign ministers of the G7 countries issued a joint statement condemning Russia’s latest escalating steps in the war against Ukraine and promising new sanctions and continued pressure on the Russian Federation.
The G7 confirmed the readiness of their countries to continue economic, financial, humanitarian, military and diplomatic support to Ukraine “for as long and on such a scale as it will be necessary to ensure Ukraine’s path to freedom, peace, recovery and economic development”.
What sanctions are being prepared
The European Union has already adopted seven packages of sanctions against Russia. In early September, the G7 countries began discussing a price ceiling for Russian oil to limit Moscow’s ability to finance the war against Ukraine. The figure was called 40-60 dollars per barrel.
The US, Japan, Germany, Britain, France, Italy and Canada and the EU are working out the details of the plan, trying to win the support of other countries, including India and China, which buy oil from Russia at a significant discount.
They want to coordinate the price ceiling implementation schedule with the sixth package of EU sanctions, which provides for an oil embargo from December 5 and an oil embargo – from February 5. Russia has threatened to stop selling oil to countries that join the price cap.
As Politico reports with reference to four EU diplomats, the European Commission has already started preparing new sanctions against Russia. The package provides for a cap on oil prices, as well as a ban on the import of diamonds and other luxury items.
The Financial Times newspaper writes that a number of EU states, including Poland and the Baltic states, are demanding that their fellow bloc members introduce tougher sanctions against Russia after the announcement of mobilization.
They presented a list of activities, including:
- exclusion of new banks from the SWIFT system
- ban on the import of Russian diamonds
- restrictions on the sale of luxury goods
- restrictions in the field of IT, cyber security, software
- introduction of similar sanctions against Belarus
However, it will be difficult to agree on the strengthening of sanctions with all 27 EU countries, so the main goal of the eighth package, which negotiators will focus on, will be to establish a ceiling for the price of Russian oil, FT and Bloomberg agency write.
“The more you offer, the more reasons for objections arise in some countries,” explained the diplomat of one of the European countries.
For example, the ban on the purchase of diamonds will hit Belgium. And the Prime Minister of Hungary, Viktor Orbán, generally stated that the sanctions against Russia should be canceled, because energy resources have become more expensive because of them.
The main goals should be to cap the price of Russian oil and close loopholes to circumvent the measures introduced earlier, another diplomat told the FT.
“There are not many products left for new sanctions, as we have already severed ties with the Russian economy to a large extent,” he said.
Bloomberg also writes that the EU will discuss the price ceiling for Russian oil.
Discussions will last several weeks, there will be many complications and a positive outcome is not guaranteed, Bloomberg sources say. They confirm that among the proposed measures are restrictions on the technology sector and on the trade in luxury goods.
Meanwhile, it became known that the European Commission is considering the possibility of softening the ban on the transportation of coal and related goods from Russia. The process is under discussion. The EC believes that easing should be done to “ensure food and energy security around the world.” A number of EU members, including Poland and the Baltic states, oppose it.