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U.S. Expands Sanctions Against Russia

  • RFE/RL

Women walk past a Sberbank office in Moscow on September 12.

Women walk past a Sberbank office in Moscow on September 12.

The United States has announced another round of sanctions aimed to punish Russia for its role in the Ukraine crisis, targeting defense, energy, and banking sectors.

The move comes after the European Union also stepped up retaliatory measures against Russia.

The U.S. Treasury Department tightened on September 12 debt-financing restrictions for sanctioned banks from 90 days to 30 days.

And it added Sberbank, Russia's largest financial institution, to the list of state banks subject to the restriction.

It also prohibited the exporting of goods, services, and technology for Russian deepwater or offshore projects to five of Russia's leading energy companies: natural gas monopoly Gazprom Gazprom, its oil unit Gazprom Neft, Lukoil, Surgutneftgas, and Russia's largest oil producer, Rosneft.

Taxes and revenues those companies generate account for a significant amount of the money going to Russia's state treasury.

The prohibition against providing material for deepwater projects will have an impact on Russia's plans to develop potentially massive oil and gas fields in the Arctic since Russian companies are dependent on Western technology to operate in the harsh conditions so far north.

Gazprom Neft and pipeline operator Transneft also have new debt restrictions of over 90 days' maturity.

Five state-owned defense-technology firms had their assets blocked.

The state-owned high-tech Russian company Rostec also was hit with new restrictions for debt financing of greater than 30 days.

The European Union’s new sanctions include asset freezes on 24 senior officials and lawmakers, including nationalist firebrand Vladimir Zhirinosvky, bringing to 119 the number of people sanctioned by the bloc over the Ukraine conflict.

The measures also include restrictions on financing for some state-controlled Russian companies such as Rosneft, Transneft, and Gazprom Neft.

The new sanctions were agreed by EU leaders on the sidelines of a NATO summit on September 5 and formally approved in Brussels on September 8.

But publication of the decision was delayed to allow time to assess the implementation of a cease-fire agreement in eastern Ukraine between Kyiv and pro-Russian separatists.

Speaking in Kyiv on September 12, European Commission President Jose Manuel Barroso warned that the Ukrainian truce was not enough to achieve long-term peace and criticized Russia over its "unacceptable behavior" in its western neighbor.

On September 11, European Council President Herman Van Rompuy said that the measures could be scaled back or repealed, and that the EU would monitor the peace process in eastern Ukraine to determine before the end of September if changes are merited.

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The Obama administration also said the sanctions could be reversed if Russia changed its behavior.

"We are watching developments since the announcement of a ceasefire in Minsk, and are prepared to roll back sanctions if Russia and the separatists implement the Minsk agreements in good faith," said a senior administration official on September 12.

Another official elaborated that the sanctions would be rolled back when all 12 points of the agreement are implemented, including complete military pullback and release of hostages.

A NATO official said on September 11 that Russia still had at least 1,000 soldiers in eastern Ukraine, despite the September 5 cease-fire deal.

Moscow denies Western accusations that it has sent troops and weapons to help the rebels.

Speaking on September 12 after a meeting of the Shanghai Cooperation Organization security bloc in the Tajik capital, Dushanbe, Russian President Vladimir Putin said Moscow was considering retaliatory measures.

Putin added that the new Western sanctions were intended to disrupt peace efforts in eastern Ukraine, saying the measures looked "a bit strange" in view of the peace drive.

However, Putin welcomed the EU decision to increase the list of sanctioned individuals, saying: “the less our officials and corporate executives travel abroad and deal with current affairs instead, the better.”

In Kyiv, Ukrainian President Petro Poroshenko welcomed the new sanctions, and announced that the Ukrainian and the European parliaments would meet on September 16 to ratify Ukraine's EU Association agreement.

He called the planned simultaneous ratification of the accord by the two parliaments a "historic moment" that defines his country's future.

He also told an international conference in Kyiv that he hoped to secure a "special status" for Ukraine with NATO during his visit to Washington next week.

With reporting by Reuters, AP, and AFP