HomeAs EU struggles to Ban Russian Oil US sanctions Gazprombank

As EU struggles to Ban Russian Oil US sanctions Gazprombank

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Even as the EU battled to finalize its latest package of measures, the US tried to deepen sanctions against Russia on Sunday by blacklisting a swath of financial executives and prohibiting the provision of professional services. 

For the first time, the US targeted executives at Gazprombank, as well as organizations that provide Russia with corporate services such as accountancy and consulting. 

Diplomats said Hungary continued to stymie movement in Brussels on the EU’s planned sixth round of sanctions, which will include a phased-in oil embargo aimed at choking off Moscow’s revenue flow. 

The G7 and its allies are attempting to increase economic pressure on President Vladimir Putin’s administration as Russia prepares for Victory Day celebrations on Monday. 

President Biden met with his G7 counterparts and Ukraine’s leader, Volodymyr Zelensky, on Sunday as part of a coordinated show of solidarity for the war-torn country. 

The new US sanctions, according to a senior Biden administration official, target 27 executives of Gazprombank, Russia’s third-largest lender and a unit of state-owned energy behemoth Gazprom. However, the sanctions did not freeze the company’s assets or prevent dealings with it, despite the fact that it is the primary means by which Russia distributes gas to Europe. 

“We’re sanctioning some of their top business executives, they’re the people who sit at the top of the organisation, to create a chilling effect,” a senior Biden administration source said, adding “we don’t want Gazprombank to be seen as a safe haven.” 

Executives of Sberbank are also being targeted, and Russian officials accused of human rights breaches will face visa restrictions. 

The new US package forbids businesses from providing accountancy, advising, and other services to Russia in an attempt to prevent Moscow from rethinking its commercial plans in order to avoid the penalties imposed by the West. 

The EU has also been working to push through its most recent sanctions package, which includes a phased-in ban on Russian crude oil as well as professional services restrictions. However, the 27 member states will continue to negotiate this week after a meeting of EU ambassadors in Brussels on Sunday ended without a deal.

Diplomats emphasized that progress had been made, but Budapest’s foreign minister, Péter Szijjártó, indicated Budapest was still unwilling to agree to the oil ban. 

“We have voted in favour of all the sanctions packages so far,” Szijjártó said on Facebook, “but this latest one would destroy the security of energy supply in Hungary, which is still on solid feet.” 

“As long as there is no solution to the problem posed by the Brussels proposal, we will not be voting in favour of this package.” 

Most nations would be required to prohibit Russian crude within six months under EU recommendations, while Hungary and Slovakia would be given until the end of 2024, and the Czech Republic would be given until June 2024. 

Meanwhile, Jill Biden, the first lady of the United States, paid a surprise visit to Ukraine on Sunday, adding to Washington’s show of support for the country after it increased aid in recent weeks. 

Zelensky's Wife Welcomes U.S. First Lady Jill Biden - Video
Zelensky’s Wife Welcomes U.S. First Lady Jill Biden – Video

In a town near the Slovakian border, she met Ukraine’s first lady, Olena Zelenska

The US embargo on professional services impacts the Big Four accountancy and consulting firms, which have begun to withdraw from Russia. 

Officials from the firms have stated that the exits could take many months. According to the senior administration official, legal services will be exempt from the prohibition, allowing corporations seeking due process through US lawyers to continue doing so. 

This could change in the future, according to the official. The US also placed eight Russian shipping and maritime businesses on a no-fly list, alleging that they helped Russia resupply soldiers, seize Crimea, and exploit energy deposits. 

The US has placed a blockade on 69 vessels linked to these companies. New export bans and sanctions against three of Russia’s most popular state television networks are part of the US package. The export of industrial engines, bulldozers, and other industrial goods is also prohibited, according to the official. Chemical exports will be restricted by the EU. 

“These new controls will further limit Russia’s access to components that it needs to replenish and restock its military capabilities,” a senior administration official said.

Image Credit: Getty

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