EU and US Impose New Sanctions On Russia

The United States and the European Union imposed new sanctions on Russia this week and advanced plans to leverage frozen Russian state assets for use by Ukraine, a series of moves aimed at increasing economic pressure on Moscow amid its ongoing conflict with Kyiv, CNBC reported Thursday.

The new sanctions began Wednesday when President Donald Trump unveiled the first direct US sanctions on Russia’s energy giants Rosneft and Lukoil and nearly three dozen subsidiaries. The move imposes full blocking measures on the two Russian companies, with US officials warning foreign financial institutions risk secondary sanctions if they facilitate significant transactions for Russia’s military-industrial base.

The EU followed suit on Thursday with a new sanction package – its 19th – that bans Russian liquefied natural gas (LNG) imports starting next year, tightens restrictions on Russian banks and diplomats, and targets entities in China, Hong Kong, and India that help Russia evade controls.

The measures follow stalled peace efforts over the ongoing conflict in Ukraine, with observers saying the Trump administration’s decision marks a major U-turn for Washington.

The president had initially expressed skepticism on whether sanctions would pressure Russia into starting talks to end the war and sought to convince his Russian counterpart to change course during months of prolonged negotiations, the Wall Street Journal wrote.

But earlier this week, Trump canceled a planned in-person summit with Putin in Hungary, saying he did not want a “wasted meeting.”

The new sanctions are aimed at cutting one of Russia’s largest sources of revenues, with European Commission President Ursula von der Leyen saying the bloc is “hitting Russia’s gas sector – the heart of its war economy.”

Washington’s long-awaited decision drew praise from EU officials and Ukraine’s President Volodymyr Zelenskyy.

Meanwhile, EU leaders met Thursday to finalize a plan to use roughly $163 billion in frozen Russian sovereign assets held mainly by Belgium’s Euroclear – a central securities depository – to fund Ukraine’s defense and reconstruction, according to the Washington Post.

The proposed “reparation loan” would see the EU lend Ukraine money backed by these frozen funds without technically seizing them, an effort designed to sidestep legal and financial risks of seizure while avoiding a precedent feared by investors and central banks.

EU officials said the move is essential as Trump refuses to release more US funding for Kyiv and insists Europe must now carry the burden of the war effort.

But while the leaders agreed to support Ukraine’s war effort, they stopped short of approving the proposal to use frozen Russian assets following objections from Belgium, Al Jazeera reported.

In response, Moscow has denounced both moves. Kremlin spokesman Dmitry Peskov called the asset plan “theft,” while other Russian officials warned of seizures of Western assets in Russia if confiscations proceed.

Former Russian President Dmitry Medvedev labeled the new US sanctions an “act of war,” vowing intensified strikes in Ukraine, Reuters noted.

On Thursday, Putin described the levies as an “unfriendly act” and said Russia will not bow to pressure. Still, he acknowledged that “some losses are expected” from the new sanctions, the Guardian added.

Analysts said that full blocking sanctions on Rosneft and Lukoil could deliver a “severe hit” to Russia’s war financing. Others called the EU loan structure “clever” but acknowledged it effectively puts EU taxpayers on the line while raising market-confidence risks that could spook sovereign depositors, notably in China.