(CNN) — The United States will announce new sanctions against Russia this Wednesday in coordination with the G7 nations and the European Union, according to a Biden administration official.
The official noted that the sweeping package “will impose significant costs on Russia and push it further down the path of economic, financial and technological isolation.”
The new sanctions package will ban all new investments in Russia, increase sanctions against financial institutions and state-owned companies in Russia, and sanction Russian government officials as well as their relatives.
On the other hand, the European Union will also impose new sanctions on Russia, probably on gas and oil, the head of the European Commission, Ursula Von der Leyen, said on Wednesday.
“At this critical point in the war we must again increase the pressure on Putin,” von der Leyen said in a speech to the European Parliament in Brussels. On Tuesday, the EU announced its plans to impose a fifth package of sanctions on Russia that includes a ban on importing Russian coal.
“These sanctions will not be the last. As I said yesterday. Yes, now we have banned coal, but now we have to look at oil,” von der Leyen said. The EU must also examine Russia’s “income from fossil fuels,” he added.
The head of the European Council, Charles Michel, echoed these remarks in a tweet on Wednesday, stating that the EU “will need action on oil, and even gas, sooner or later.”
The new US sanctions package
These new measures represent the latest escalation in efforts by the US and its allies to impose costs on Russia following its invasion of Ukraine. And also, over time, hitting critical economic sectors that the country uses to wage war. They also come after more atrocities by Russian forces in northern Ukraine became known, with the devastating images of bodies in Bucha, which have accelerated discussions between the US and its European allies to increase economic measures, officials said. .
“These measures will degrade key instruments of Russian state power, inflict acute and immediate economic damage against Russia, and hold accountable the Russian kleptocracy that finances and supports Putin’s war,” a US official said. “These actions will be taken in conjunction with our allies and partners, demonstrating our resolve and unity to impose unprecedented costs on Russia for its war against Ukraine.”
The official added: “We had already concluded that Russia committed war crimes in Ukraine. And Bucha’s information seems to show more evidence of war crimes. As the president said, we will work with the world to ensure there is a surrender.” of total accountability for these crimes. One of those tools is sanctions. And we have been working intensively with our European allies on new sanctions.”
More sanctions for Russia
The expected sanctions come after the US Treasury Department announced it will no longer allow Russia to pay its debt using dollars stored in US banks. While Washington imposed sanctions on Russia’s Central Bank by freezing its foreign currency in US banks, the Treasury had previously allowed Russia to use those reserves to service its debt.
It’s a move that officials say will substantially increase the risk of default. It will also, they say, undermine the central bank’s urgent efforts to stop the immediate bleeding into the Russian economy in the wake of the Western response to the invasion.
Since the Russian invasion of Ukraine began in late February, the US and its allies have sanctioned hundreds of Russian elites and lawmakers. They have also restricted the country’s access to Western technology important to its defense and technology sectors, frozen roughly half of Russia’s foreign reserves, and suspended specific Russian banks from the SWIFT banking network, among other measures. The United States has also banned the import of Russian oil, natural gas and other energy products.
While the severity and swiftness of Western sanctions against Russia are unprecedented, key exceptions remain as US officials continue to monitor US and European supply chains and seek to limit the impact of sanctions on Western economies. that are dealing with inflation at record levels.
CNN reported late last week that Russia is facing a deep recession and high inflation, as sanctions push the country into an increasingly closed economy. A change that US officials believe the Kremlin will struggle to achieve as it has long relied on the sale of raw materials to buy sophisticated equipment and consumer goods.