EU cuts 10% of Russian imports with new sweeping sanctions

  • EU bans Russian coal as first strike against energy imports
  • Existing coal contracts must be terminated by early August
  • The EU also bans the import of Russian chemicals, vodka, caviar
  • Exports of technology, jet fuel to Russia banned
  • Other oligarchs, Putin’s daughters, are facing asset freezes

April 8 (Reuters) – The European Union on Friday officially passed new sweeping sanctions against Russia, including bans on imports of coal, wood, chemicals and other products estimated to cut at least 10% of total imports from Moscow.

The measures also prevent many Russian ships and trucks from accessing the EU, further crippling trade, and will ban all transactions with four Russian banks, including VTB. (VTBR.MM)

The coal ban, the first the EU has imposed so far on energy imports from Russia, will take full effect from the second week of August. From Friday no new contracts can be signed.

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Existing contracts must be terminated by the second week of August, allowing Russia to continue receiving payments from the EU for coal exports until then. Continue reading

“These latest sanctions came after the atrocities committed by Russian forces in Bucha and elsewhere under Russian occupation,” EU top diplomat Josep Borrell said in a statement.

The Kremlin has said that Western claims that Russian forces committed war crimes by executing civilians in the Ukrainian city of Bucha are a “monstrous fabrication” aimed at denigrating the Russian army.

The Commission estimates that the coal ban alone will cost Russia eight billion euros a year in lost revenue. That is twice as much as EU Commission chief Ursula von der Leyen said on Tuesday Continue reading .

Oil and gas imports from Russia, which have so far remained untouched, together have a value of about 100 billion euros per year.

In addition to coal, the new EU sanctions ban imports from Russia of many other commodities and products, including timber, rubber, cement, fertilizers, high-value seafood such as caviar, and spirits such as vodka, for a combined value added to €5.5 billion ($5.9 billion). US dollars) per year estimated.

An EU official said the combined import bans are worth at least 10% of what the EU will buy from Russia in a year. This comes on top of previous import bans that have hit the steel and iron sectors. Overall, up to a fifth of all value-based imports from Russia are likely to be reduced due to direct sanctions.

The EU also restricted the export of a range of products to Russia, including jet fuel, quantum computers, advanced semiconductors, high-end electronics, software, sensitive machinery and transport equipment, for a combined value of €10 billion a year.

Along with previous export bans on other technologies, the EU has so far blocked about a quarter of its total exports to Russia by value, an EU official said.

The sanctions also ban Russian companies from participating in EU government procurement and expand bans on the use of cryptocurrencies, which are seen as a potential means of evading sanctions Continue reading .

BLACKLIST

The Commission said that under the new sanctions package, a further 217 people have been blacklisted by the EU, meaning their assets in the EU will be frozen and they will be subject to travel bans in the EU.

Most of them are political leaders of the separatist regions of Luhansk and Donetsk, but the sanctions also hit top businessmen, pro-Kremlin politicians, military personnel and even two of Vladimir Putin’s daughters.

This brings the number of people sanctioned by the EU to almost 900 since the start of the Russian invasion of Ukraine, which Moscow describes as a “special operation” to demilitarize and “denazify” the country.

Another 18 companies were also hit by the asset freeze, including four banks and military companies, almost doubling the number of companies blacklisted by the EU since the war began.

The sanctioned banks are VTB (VTBR.MM), one of the largest in Russia, Sovkombank, Novikombank and Otkritie. They had all already been banned from the SWIFT messaging system, dealing a serious blow to their ability to transfer funds.

However, EU officials said that by freezing its assets, the EU is now blocking all transactions with these banks, which they say is the toughest measure against lenders.

Leading Russian banks processing energy transactions, in particular Sberbank (SBER.MM) and Gazprombank were spared again, although Sberbank boss Herman Gref was subject to an asset freeze.

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Reporting by Francesco Guarascio and Bart Meijer; Adaptation by Philip Blenkinsop, Andrew Heavens, Nick Macfie and Raissa Kasolowsky

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