Europe’s Russia Sanctions Have a Major Blind Spot
Now It May Help Break It Apart Cyril Widdershoven is a senior maritime, energy, and geopolitical analyst and Senior Advisor at Blue Water Strategy, specialising in the strategic intersection of shipping, ports,… Over the last two years, the EU and UK have emerged as leading actors in imposing sanctions on Russia.
But people like Maria Demertzis, Professor at the European University Institute in Italy, have raised questions around the effectiveness of the sanctions campaign, as European institutions continue to operate profitable subsidiaries in the country with little scrutiny.
UK and EU regulators should broaden their sanctions campaign by increasing scrutiny of European businesses that remain economically exposed to Russia.
The new UK Foreign Secretary, Ed Miliband, announced his first Russia sanctions package, targeting six Russian banks, six shadow fleet tankers and four Russian companies importing materials believed to support Russia’s war in Ukraine, including tantalum and niobium.
Separately, in response to recent Russian attacks on Ukraine’s economic infrastructure, the EU sanctioned five individuals linked to Russia’s military-industrial complex.
The announcement means the UK government has now sanctioned more than 3,400 individuals, entities, and ships under the Russia sanctions regime since 2022, bringing the number of designations to 500 this year alone.
While Russia has made it difficult for European institutions to leave in an effort to protect its economy, regulatory pressure and exit roadmaps exist.
The European Central Bank has been increasing its pressure on Eurozone lenders to reduce their Russian exposure or leave the country.
The new EU sanctions package – the bloc’s 21st – introduces extensive transaction bans and asset freezes targeting Russian financial institutions, energy actors, crypto platforms, and entities linked to Russia’s military.
However, some companies appear to have deferred these roadmaps in search of profits.
TotalEnergies, the French energy company and oil supermajor, has kept its stakes in Yamal, Russia’s biggest LNG plant, but deconsolidated the holdings, meaning the money no longer appears in the company’s official consolidated reporting.
Its CEO, Patrick Pouyanne, said the company earns about $400 million a year from selling liquefied natural gas from Russia’s Yamal LNG plant.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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