EU unveils 18th sanctions package against Russia

The European Commission has proposed its 18th sanctions package against Moscow, primarily targeting Russia’s energy and banking sectors while tightening export bans and anti-circumvention measures

Source: European Commission President Ursula von der Leyen, presenting proposals for the 18th sanctions package against Russia on 10 June in Brussels, as reported by European Pravda

Details: Von der Leyen emphasised that the 18th sanctions package focuses on Russia’s banking and energy sectors.

"We are now proposing an 18th package of hard-biting sanctions," von der Leyen said. "We're targeting basically two sectors, the Russian energy sector and the Russian banking sector. We're widening export bans and controls and we strengthen the anti-circumvention measures." 

"For the first time, we propose to start a transaction ban for Nord Stream 1 and Nord Stream 2," she added. "This means that no EU operator will be able to engage directly or indirectly in any transaction regarding the Nord Stream pipelines. There is no return to the past." 

The European Commission also proposes reducing the G7 oil price cap from US$60 to US$45 per barrel, von der Leyen announced.

"Since the oil cap was introduced in 2023, oil prices have gone down," she said. "They now trade very close to the cap level. By lowering the cap, we adapted to changed market conditions and restored its effectiveness. Oil exports still represent one-third of Russia's government revenues. We need to cut this source of revenue."

She added that "the oil price cap is a G7 coalition measure, so we will discuss at G7 in Canada at the beginning of next week how to act together".

"To better enforce the cap, on top of the 342 vessels already listed, we list today an additional 77 vessels that are part of the Russian Shadow Fleet. These vessels are a means to evade sanctions," the European Commission president said.

The Commission also proposes banning imports of petroleum products derived from Russian oil: "We want to prevent that some of the Russian crude oil reaches the EU market through the backdoor".

The second focus is the banking sector, specifically "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," von der Leyen said. "And we propose to apply such a transaction ban to another 22 Russian banks." 

Quote: "We also propose to extend the transaction ban to financial operators in third countries that finance trade to Russia in circumvention of sanctions. And we also propose to sanction the Russian Direct Investment Fund, its subsidiaries and its investment projects."

More details: The third element, von der Leyen noted, involves export bans worth over €2.5 billion, depriving Russia of critical technologies and industrial goods.

"We're targeting machinery, metals, plastics and chemicals. They are used as raw materials in industry. And we also restrict the export of dual-use goods and technologies that are used for producing drones, missiles and other weapons systems… We want to make sure that Russia does not find ways to modernise its weapons with European technologies," the European Commission president said.

Finally, the EU aims to enhance sanctions enforcement and compliance.

Quote from von der Leyen: "That is why we widen the scope of the transaction ban that already exists. 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 efforts of conquering Ukraine carry a heavy responsibility.

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 towards reducing civilian suffering, allow space for meaningful talks for a genuine peace."

Background: 

• On 20 May, the EU Council approved the 17th package of sanctions against Russia for its war against Ukraine, individual sanctions for the use of chemical weapons against Ukraine and personal sanctions for Moscow's hybrid destabilisation activities against EU members and allies.
• Lithuanian President Gitanas Nausėda criticised the 17th package as being too weak and called for tougher measures in the next one.

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