Mar 23, 2022 - World

Russian energy sanctions drive gap in Western unity

Data: Castellum.AI; Table: Kavya Beheraj/Axios
Data: Castellum.AI; Table: Kavya Beheraj/Axios

Europe's resistance to imposing sanctions on Russian energy has only hardened 28 days into the invasion of Ukraine, driving a wedge into a Western alliance initially hailed for acting with unprecedented speed and unity.

Why it matters: Ukrainian President Volodymyr Zelensky has pleaded with the West to impose new sanctions "every week until the Russian military machine stops," but appetite for major sectoral restrictions appears to be withering.

  • In one notable break, Japan, Canada and other nations have resisted a call to ban sanctions on export — or imports — of luxury goods to and from Russia.

What to watch: President Biden is expected to announce new sanctions on hundreds of Russian lawmakers after meeting with G7 and EU leaders in Brussels on Thursday.

  • The allies will also work to close loopholes to enforce existing sanctions, but European officials say they don't expect a major new package designed to further choke off the Russian economy to be unveiled.
  • Bloomberg reported Wednesday the U.S. and EU could finalize a deal during Biden's trip to guarantee supplies of American liquefied natural gas to Europe over the next two years.

The big picture: The EU has proposed a roadmap to becoming independent of Russian fossil fuels "well before" 2030, and has taken compromise steps like banning investment in the Russian energy sector.

  • In the interim, the bloc will be forced to continue financing the Russian war machine to keep its heat on through the winter.
  • "We will end this dependence as quickly as we can, but to do that from one day to the next would mean plunging our country and all of Europe into a recession," German Chancellor Olaf Scholz said Wednesday.
  • White House national security adviser Jake Sullivan said Tuesday the president wouldn't pressure the EU to follow his lead in banning Russian energy imports. Sullivan called the U.S. "uniquely positioned" as an energy producer to withstand the collateral impact of sanctions.

Between the lines: President Vladimir Putin announced Wednesday that Russia would require "unfriendly nations" to pay for gas in rubles.

  • That would threaten to undermine Western financial sanctions by forcing Europe to prop up his nation's currency.
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