8th EU Sanctions, Oil Price Cap Will “Make Kremlin Pay” For ‘Sham’ Referendums: Von Der Leyen

8th EU Sanctions, Oil Price Cap Will “Make Kremlin Pay” For ‘Sham’ Referendums: Von Der Leyen

European Commission president Ursula von der Leyen on Wednesday touted that newly prepared EU sanctions will “make the Kremlin pay” for conducting its “sham” referendums in occupied Ukraine. Russian media the evening prior declared a sweep in favor of four regions joining the Russian Federation – including Donetsk, Luhansk, Kherson and Zaporizhzhia. President Putin is expected to announce their integration into Russia in a Friday speech.

“We do not accept the sham referenda and any kind of annexation in Ukraine, and we are determined to make the Kremlin pay for this further escalation,” von der Leyen told a scheduled press briefing in Brussels.

She announced a proposed eighth round of sanctions in a package that includes an expanded ban on Russian products and key technology, particularly out of Russia’s aviation, electronics, and chemical products sectors. The new package when implemented is “expected to deprive Moscow of an additional 7 billion euros ($6.7 billion) in revenues,” according to the EC chief’s announcement.

Sept.28 press briefing in Brussels on Ukraine conflict and Russia sanctions.

The new package also includes a range of targeted sanctions on Russian ministry and military officials, including officials responsible for organizing the Ukraine referendums. Additionally, EU nationals will be barred from having high-paying roles in Russian state-owned companies.

Perhaps more important, and controversial given the fresh sanctions would need unanimous approval by the EU’s 27 member states before implementation, is the oil price cap. Currently, partial prohibitions targeting Russian crude will kick in on December 5th. Though it doesn’t extend directly to shipping, a June sanctions package saw EU countries agree to block European companies from providing insurance and financial services for Russia’s seaborne oil.

In the Wednesday announcement, von der Leyen previewed, “We are laying the legal basis for this oil price cap.” This as Bloomberg is confirming this would include “a price cap for Russian oil sold to third countries.” But therein lies the biggest hurdle towards its passage as member states like Hungary have long warned that dramatic changes in its predictable energy supply levels received from Gazprom would put Hungary’s entire economy at risk.

As Bloomberg observed last week, when the price cap plan again came into central focus amid Putin’s ‘partial mobilization’ and escalation in Ukraine: “Representatives of national governments in Brussels will aim to reach a preliminary deal on the price cap ahead of an informal gathering of EU leaders in Prague on Oct. 6, the people said. But one of the biggest question marks will be Hungary, which has often played the spoiler when unanimous decisions are needed in the EU.”

In response to the European Commission’s eighth sanctions package rollout announcement, the Biden administration says it is prepared once again to partner in imposing “severe economic costs on Russia over its sham referendums,” according to the words of the Head of the Office of Sanctions Coordination Jim O’Brien.

Tyler Durden
Wed, 09/28/2022 – 14:45

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