EU Unveils 18th Sanctions Package Against Russia
Allow me to begin by saying a few words about the terrible events in Graz.
Mich hat die Nachricht heute Morgen ins Mark getroffen. Der Tod unschuldiger Kinder ist das Schlimmste, was einer Familie oder einer Gemeinschaft passieren kann. Meine Gedanken sind heute bei den Familien der Toten, bei den Verletzten und ihren Freunden und Angehörigen. Schulen sind Symbole der Hoffnung, der Zukunft und der Jugend. Es fällt unendlich schwer zu ertragen, wenn Schulen zu Orten der Gewalt und des Todes werden. Ich trauere heute mit Österreich. Und ich danke allen Helferinnen und Helfern und den Einsatzkräften in diesen schweren Stunden.
Let me continue on the topic of sanctions.
We want peace for Ukraine. Despite weeks of diplomatic attempts, despite President Zelensky’s offer of an unconditional ceasefire, Russia continues to bring death and destruction to Ukraine. Russia’s goal is not peace, it is to impose the rule of might. Therefore, we are ramping up pressure on Russia. Because strength is the only language that Russia will understand.
The Russian economy is deeply affected by the sanctions. 210 billion EUR of reserves of the Central Bank of Russia are immobilised. Russia’s oil and gas revenues have fallen by almost 80% compared to before the war. Its deficit is skyrocketing. Interest rates are prohibitively high. Inflation is on the rise, well above 10%. The price of importing technologies and critical goods is six times higher than before the war and compared to global average prices. In short, Russia’s economy is limited to a war economy and sacrificing future prospects.
Our message is very clear: this war must end. We need a real ceasefire, and Russia has to come to the negotiating table with a serious proposal. As it is up to today not showing willingness to achieve peace, we will step up pressure on Russia, including through further robust sanctions. Therefore, we are now proposing an 18th package of hard-biting sanctions. We are targeting two sectors. Russia’s energy sector. And Russia’s banking sector. We are widening export bans and controls, and we are strengthening the anti-circumvention measures.
First, on the energy side. For the first time, we propose a transaction ban for Nord Stream 1 and Nord Stream 2. This means that no EU operator will be able to engage directly or indirectly in any transactions regarding the Nord Stream pipelines. There is no return to the past.
We also propose to lower the oil price cap from 60 dollars to 45 dollars per barrel. Since the oil cap was introduced in 2023, oil prices have gone down. They now trade very close to the cap level. By lowering the cap, we adapt it to changed market conditions and restore its effectiveness.
Oil exports still represent one third of Russia’s government revenues. We need to cut this source of revenue. The oil price cap is a G7 coalition measure. We will discuss how to act together. at the G7 Summit in Canada. In addition: To better enforce the cap, on top of the 342 vessels already listed, we list today additional 77 vessels that are part of the Russian shadow fleet. These vessels are a means to evade sanctions. With our listings, we severely constrain Russia’s options to export its oil through a shadow fleet. Finally, we introduce a ban on the import of refined products based on Russian crude oil. In this way, we want to prevent that some of the Russian crude oil reaches the EU market through the back door.
Now let’s have a look at the banking sector, the second part: we are targeting the Russian banking sector by limiting its ability to raise funding and conduct transactions. We propose to transform the existing prohibition to use the SWIFT system into a full transaction ban. And we propose to apply such a transaction ban to another 22 Russian banks.
We also propose to extend the transaction ban to financial operators in third countries that finance trade to Russia in circumvention of sanctions. We also propose to sanction the Russian Direct Investment Fund, its subsidiaries and its investment projects. In this way, an important channel for financing projects to modernise the Russian economy and strengthen its industrial base will be limited.
The third point is that we propose further export bans worth more than 2.5 billion euro. This ban deprives the Russian economy of critical technology and industrial goods. We are targeting machinery, metals, plastics and chemicals: They are used as raw materials in industry. We also restrict the export of dual use goods and technologies that are used for producing drones, missiles, and other weapon systems. We want to make sure that Russia does not find ways to modernise its weapons with European technologies.
Fourth and final, we want our sanctions to be better applied and respected. That is why we widen the scope of the transaction ban that already exist. And we list 22 Russian and foreign companies providing direct or indirect support to Russia’s military and industrial complex. Putin’s ability to sustain the war very much depends on the support he receives from third countries. Those who support Russia’s war and the effort of conquering Ukraine carry a heavy responsibility.
With this package, we step up pressure on Russia. Our objective is very clear: We are reiterating the call for a full, unconditional ceasefire of at least 30 days. This pause in hostilities could serve as a vital step toward reducing civilian suffering and allow space for meaningful talks for genuine peace.
https://ec.europa.eu/commission/presscorner/detail/en/statement_25_1471