The European Commission proposed its 20th package of sanctions against Russia on February 6. The measures include a full ban on maritime services for Russian crude oil, the sanctioning of regional Russian banks and cryptocurrency channels, and new export and import restrictions. European Commission President Ursula von der Leyen announced the proposals, which aim to reduce Russia's revenue streams.
Proposal Overview
The European Commission formally proposed its 20th package of sanctions against Russia on February 6. These measures, announced by European Commission President Ursula von der Leyen, seek to achieve several objectives.
The stated objectives include encouraging Moscow towards peace negotiations and increasing the difficulty, risk, and cost associated with selling Russian oil, as well as reducing revenue streams for Russia's military actions in Ukraine.
EU foreign policy chief Kaja Kallas indicated that the EU aims to adopt the 20th sanctions package on February 24, which would mark the fourth anniversary of Russia's full-scale invasion of Ukraine.
Key Measures Proposed
The proposed package introduces new restrictions across several sectors, targeting Russia's economic and military capabilities.
Energy Sector- Maritime Services Ban: A central element is a full ban on maritime services for Russian crude oil. This would prohibit European companies from providing insurance, shipping, financing, and other key services for transporting Russian oil. This measure is intended to be coordinated with G7 partners and aims to bypass the G7 oil price cap mechanism.
- Currently, over one-third of Russia's crude oil exports utilize Western infrastructure and services associated with Greece, Cyprus, and Malta, primarily destined for India and China. The proposal aims to redirect this oil into alternative shipping networks.
- Shadow Fleet: Restrictions would target Russia's "shadow fleet," with a proposal to list 43 additional vessels. This would increase the total number of vessels on the EU's shadow fleet blacklist to approximately 640.
- LNG and Icebreakers: The package includes a ban on maintenance services for Russian LNG tankers and icebreakers, complementing existing bans on LNG imports.
- Russian Banks: The proposal includes sanctioning 20 regional Russian banks.
- Cryptocurrency: It targets crypto-related channels identified as being used for sanctions evasion.
- Third-Country Facilitators: Banks in third countries that facilitate trade with Russia or assist with sanctions evasion would also face sanctions.
- Export Bans: Additional export bans would apply to goods and services such as rubber, tractors, and cybersecurity tools.
- Import Bans: New import bans are proposed for metals, chemicals, and critical minerals from Russia.
- Company Sanctions: Over 40 companies in Russia and third countries are proposed for sanctions, with the stated aim of disrupting production lines.
- Anti-Circumvention Tool: For the first time, the EU plans to activate its anti-circumvention tool on a specific country to prevent sensitive products from reaching Russia via re-exports.
- Technology Controls: Controls on technologies used for Russia's military efforts would be strengthened.
- Ammonia Imports: A quota on ammonia imports is also proposed.
Approval Process and Anticipated Impact
All EU sanctions packages require unanimous approval from the bloc's member states to take effect.
The initial G7 oil price cap mechanism aimed to maintain global oil flow while reducing Russia's revenue, but its enforcement encountered challenges. The proposed services ban is considered a more direct approach.
While not expected to halt Russian oil exports entirely, it is anticipated to redirect more oil into channels with increased logistical complexities and reduced profit margins.