The United States and the European Union announced new sanctions against Russia, targeting defense, banking and energy sectors in what is currently the strongest international action against the country for the support shown for Eastern Ukraine rebels.
President Obama declared:
“If Russia continues on this current path, the costs on Russia will continue to grow. Russia’s actions in Ukraine and the sanctions that we’ve already imposed have made a weak Russian economy even weaker.”
The European bloc agreed to restrict trade on equipment for the defense and oil sectors. The state bank of Russia will be barred from financial activities in the capital markets of Europe.
While sanctions are applied and more weapons seem to be rushed across the border to help Eastern Ukraine Pro-Russian militants, Ukrainian forces are mounting a strong offensive against the two main cities controlled by the rebels.
The US Treasury imposed new sanctions against Russian banks, targeting the Bank of Moscow, the Russian Agriculture Bank, the United Shipbuilding Corp and VTB. European sanctions will apply to new contracts.
European companies and countries will face strong economic repercussions of the new sanctions against Russia. BP is the largest foreign investor in the country with 20% stake in Rosneft, the biggest oil company in Russia.
German manufacturing firms can lose customers, European banks and different creditors can have troubles with their clients repaying and refinancing loans because of money owned by Russians and London can also be faced with financial problems due to the measures.
Violence in Eastern Ukraine is currently not allowing experts to visit the crash site of flight MH17, which is one of the reasons why the new sanctions were announced.