EU’s New Sanctions Boost Allies’ Push to Target Russian Energy
(Bloomberg) -- The European Union adopted a new package of sanctions targeting Russia’s energy infrastructure, building on new US and UK moves to chip away at Moscow’s ability to wage its war against Ukraine.
The EU measures will ban LNG imports from 2027, according to the European Commission, the EU’s executive arm. The EU will also impose a full transaction ban on two major Russian oil companies, Rosneft PJSC and Gazprom Neft PJSC, and sanction 117 additional so-called shadow fleet vessels, which have enabled Russia to evade previous measures.
The move adds momentum to western allies’ renewed push to punish Moscow. On Wednesday, the US announced sanctions on Russia’s two largest oil producers, Rosneft and Lukoil PJSC, after a potential summit between US President Donald Trump and Russian leader Vladimir Putin was called off. Those penalties came a week after the UK also hit the same Russian oil giants.
“The 19th package is very important,” Ukrainian President Volodymyr Zelenskiy told reporters on Thursday before joining EU leaders at a summit in Brussels. “But American sanctions are also very important. And this is a good signal to other countries in the world to join the sanctions.”
The potential Trump-Putin gathering had unnerved European officials, who feared Trump may be adopting a more Putin-friendly stance after several months where he publicly threatened Russia with sanctions and appeared receptive to Ukraine’s pleas for additional weapons.
Still, Zelenskiy left a meeting with Trump last week without desired commitments on long-range missiles. Instead, Trump urged both Zelenskiy and Putin to declare an immediate ceasefire and begin negotiations.
Zelenskiy is open to that approach and joined a statement with European leaders this week, when they all endorsed the suggestion.
“A ceasefire is possible, of course, and I think all of us need a ceasefire,” Zelenskiy said Thursday. “But we need more pressure on Russia for a ceasefire.”
EU leaders said the latest US sanctions would help impose that pressure.
“The rhetoric recently has been much stronger from the US administration, but this decision is a game changer,” Lithuanian President Gitanas Nauseda told reporters, calling the US penalties “a very strong blow to the Russian economy.”
In addition to hammering Russian energy, the EU package goes after 45 entities that have helped Russia evade sanctions, including 12 companies in China and Hong Kong. Among the Chinese companies are Tianjin Xishanfusheng International Trading Co., Liaoyang Petrochemical Company, Chinaoil (Hong Kong) Corporation and Shandong Yulong Petrochemical Co., according to a document listing the sanctions.
China blasted the penalties on Thursday.
“The EU has repeatedly imposed illegal unilateral sanctions on Chinese enterprises under the pretext of issues related to Russia,” Chinese Foreign Ministry spokesman Guo Jiakun said at a press briefing in Beijing.
Notably, the package also cracks down on Russia’s crypto finances, banning crypto-asset services for Russian nationals, residents and entities.
Additionally, it prohibits reinsurance for used Russian aircrafts and vessels, and includes a full transaction ban on five Russian banks. It also extends a transaction ban to Russian electronic payment systems and third-country banks in Belarus and Kazakhstan.
“The sanctions have real impact and are hurting the Russian economy,” Danish Foreign Minister Lars Lokke Rasmussen said in a Thursday statement. “Russia is finding it increasingly difficult to finance its illegal war of aggression against Ukraine.”
(Updates with quotes from Danish foreign minister, Ukrainian president and Lithuanian president, and with additional information on sanctions throughout.)
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