© Reuters. FILE PHOTO: In this illustration taken on Feb. 28, 2022, plastic letters arranged to read “Sanctions” are placed in front of the colors of the U.S. and Russian flags.REUTERS/Dado Ruvic/Illustration/File Photo
By Daphne Psaledakis
WASHINGTON (Reuters) – The United States has imposed several sanctions on Russia over its invasion of Ukraine in February, targeting its central bank, major banks, oligarchs and Russian President Vladimir Putin.
Here are some ways the U.S. can further tighten sanctions on Russia.
The European Commission on Wednesday proposed its toughest package of sanctions to date against Moscow in its war in Ukraine, including a planned embargo on Russian oil.
Diplomats said the talks were complicated, but many expressed confidence that all 27 EU governments could reach an agreement by next week.
Edward Fishman, who worked on Russia sanctions at the State Department during President Barack Obama’s administration, said that now the EU is moving towards an oil embargo, which opens up the possibility of what Washington and its allies can do next.
“I think the next step will be for the U.S. to work with the European Union and other members of the G7 to globalize the campaign against Russian oil sales,” Fishman said.
Some possible steps in the West to limit Russia’s receipt of payments for oil could include requiring all payments for Rosneft to go into escrow accounts outside Russia, and capping the price of payments for Rosneft, with secondary sanctions, Fishman said.
Another option, Fishman said, is for the EU to impose an import tax on Russian oil.
Brian O’Toole, a former Treasury official now at the Atlantic Council think tank, said the U.S. could also ban insurance on Russian oil cargoes and threaten any foreigners who do major transactions with Russian goods. Implement secondary sanctions. Blood vessel.
Such a move would “significantly complicate Russia’s ability to ship oil elsewhere,” he said.
The U.S. could also further strengthen energy-related sanctions by adding major companies such as oil giant Rosneft or gas producer Gazprom (MCX: ) to the Specially Designated Nationals (SDN) list.
Strengthen sanctions on banks, state-owned enterprises
The U.S. could also expand penalties on Russian banks and state-owned companies, experts said.
The United States has imposed sanctions on major Russian banks, including the country’s largest bank, Sberbank.
Washington could further target Gazprombank and other companies, using Washington’s most powerful sanctions tools and adding them to the SDN list, O’Toole said.
Such a move would effectively kick them out of the U.S. banking system, ban them from trade with Americans and freeze their U.S. assets.
“There is no strategic interest in Russian banking other than Gazprombank. So, frankly, if they do Gazprombank alone, I think the next steps will be just a full-blown financial embargo,” O’Toole said.
O’Toole said a sweeping financial embargo against Russia could be implemented by issuing a new executive order that would bar Americans from exporting or importing goods, services or technology from Russia.
“Then Russia becomes Iran,” he said.
Fishman said the U.S. could also impose secondary sanctions on designated Russian entities and individuals, which would threaten anyone in the world doing business with Russia.
further fast restrictions
In early March, the European Union designated seven banks to be banned from joining SWIFT, the world’s major international payments network, including Russia’s second-largest bank VTB. However, lenders that process energy payments have been spared.
The US and its allies could further tighten these restrictions and prevent more or all Russian banks from accessing SWIFT.
The latest round of EU sanctions proposes to drop Sberbank from SWIFT.
The United States could impose sanctions on Russian oligarchs that have not yet been targeted, perhaps by aligning its measures with the European Union and Britain, which target several Russian oligarchs that Washington has not yet designated.
They include billionaire Roman Abramovich and tycoon Mikhail Friedman.
In his State of the Union address in March, Biden said the United States would work to seize the yachts, luxury apartments and private jets of wealthy Russians with ties to Putin.