Russia Sanction Tracker – Three Add Russia Oil Sanctions

‘Positive shifts’ in talks between Russia and Ukraine did not stop more sanctions being imposed over the past week. The US, UK, and Australia have committed to tightening restrictions on Russian energy exports while the EU look likely to add a fourth round of sanctions. Outside of the EU-US Alliance, more countries are opting not to take unilateral action and to exclude important imports from Russia off the list. Here are the details:

Countries Within the EU-US Alliance

Countries within the EU-US alliance have looked to hinder the Central Bank of Russia, oligarchs, and PEPs from using international resources (Table 1). Here are the details:

• On energy, the US imposed a ban on imports of Russian energy, affecting oil, gas, and energy, as have Australia. Both bans will be implemented 22 April and 25 April, respectively. Bans in the UK are lighter, the UK will phase out Russian oil imports. In contrast, Hungary will not support sanctions on Russia covering oil and gas. Looking further out, European Commission President Ursula von der Leyen outlined a plan to the national leaders to cut Russian energy reliance by 2027.
• Staying with the European Union, the EU agreed to expand sanctions. They targeted 14 Russian businessmen and cut off three Belarusian banks from SWIFT. Meanwhile, the US sanctioned Russian businessmen tied to ABR Management and Novikombank, the UK added sanctions to 386 lawmakers and Canada have added sanctions to five current and former senior officials of the regime.

• It comes as the G7 intensified sanctions, they will suspend Moscow’s privileged trade and economic treatment as well as ban exports to Russia of EU luxury goods. Japan has joined the US and EU in banning chip exports to Russia. Potential future bans to ‘virtual currency’ have also been mooted.

• Meanwhile, on flight activity, Russian air traffic can no longer operate in British airspace. Reports suggest that Russian oligarchs have headed to Israel with their private jets.
• Lastly, the slow start to New Zealand sanction momentum has begun to change as the government is preparing legislation that will allow it to impose tougher and targeted sanctions on individuals and entities.

Outside the EU-US Alliance

Countries outside the EU-US alliance have been less willing to impose sanctions on Russia. Some prefer economic neutrality at this point. Here are the details:

• Chinese Foreign Minister Wang Yi said further sanctions against Russia will be ineffective. They doubled the Yuan’s trading band versus the Ruble to 10%, to help bolster trade between the two countries.
• Elsewhere, Malaysia ruled out imposing unilateral sanctions on Russia, instead opting to follow those imposed by the United Nations. As we had previously said, these are unlikely to come to fruition in the short-term as the UAE and Russia are likely to veto. Egypt is also looking for their ties to remain tight with Russia following a call between the Presidents of the two countries.
• In South America, Brazil have gained support from Argentina, Bolivia, Chile, Paraguay, and Uruguay to propose (to the UN) an exclusion of fertiliser from Russia sanctions. Brazil imports 85% of its fertiliser, 20% of which comes from Russia.

What Have Russia and Ukraine Done?

Russia is retaliating with their own sanctions. Russia has banned the export of 200 goods and equipment but excluded energy from the list. One notable inclusion is timber, 10% of their production is exported. Meanwhile, they have eased reporting requirements for banks, which no longer must meet national standards or any additional disclosures on their websites. Last, Press Secretary Jen Psaki tweeted that Russia may consider seizing the assets of US and international companies that have announced plans to suspend operations in Russia or to withdraw from the Russian market.

Meanwhile, Ukraine has banned export of essential foods including wheat, buckwheat, meat, eggs, oil, and sugar.

Bilal Hafeez is the CEO and Editor of Macro Hive. He spent over twenty years doing research at big banks – JPMorgan, Deutsche Bank, and Nomura, where he had various “Global Head” roles and did FX, rates and cross-markets research.

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