Russian economy nightmare as £348bn sanctions on Putin to stay despite ceasefire

Vladimir Putin is facing a fresh economic nightmare as the EU looks to stick with sanctions that have reportedly resulted in the loss of £348billion in Russian revenue despite agreeing a ceasefire in the Black Sea with Ukraine. EU envoy David O’Sullivan said in an article for the Center for European Policy Analysis (CEPA) earlier this week that the punishment measures “pack a punch” and “we must stick to the course”.

“They have obliged Russia to invest $10billion to constitute a parallel fleet of ships to transport its oil in circumvention of the G7-agreed oil price cap,” Mr O’Sullivan wrote. “The EU has sanctioned 153 ships, including 131 shadow fleet tankers. Most of these ships are now unable to transport cargo, despite their efforts to obfuscate their identities. Sanctions are increasing costs and delays and reducing equipment quality.”

He added: “The price of components has risen by 30% for the Russian war machine. Sanctions have prevented Russia from expanding military supplies to the battlefield despite extra investment and enormous military losses.

“Where there are sanctions, there is circumvention. While sanctions are not foolproof, they act as vital grit in the system, making it harder, slower, and more expensive for Russia to wage its war.

“We must stick to the course. In the words of European Commission President Ursula von der Leyen: we stand ready “to increase punitive sanctions against Russia, unless they (Russia) demonstrate true willingness to achieve a lasting peace agreement.”

The European Commission's foreign affairs spokesperson, Anitta Hipper, said on Wednesday that officials would consider lifting or amending its measures against Russia if the country ended its unprovoked aggression in Ukraine, and carries out an "unconditional withdrawal" of all its forces from Ukraine.

The Institute for the Study of War (ISW) said this was “likely a response to the Kremlin's recent demand that it will not implement the terms of the ceasefire in the Black Sea with Ukraine until the US lifts sanctions on Russian state-owned agricultural bank Rosselkhozbank and other unspecified financial organizations involved in international food and fertilizer trade”.

Experts added that the US will likely require “EU cooperation” to lift some sanctions and restrictions on Russian agricultural, financial, and trade entities to “reconnect” the country to international agricultural and fertiliser markets.