Ukraine: What sanctions are being imposed on Russia?
2022-02-24 17:39:30+00:00

Western nations are preparing to impose severe sanctions on Russia,
after it launched an invasion of Ukraine.

The measures are designed to cripple Russia's economy and force
President Vladimir Putin to halt military action.

A sanction is a penalty imposed by one country on another, often in
order to stop it acting aggressively or breaking international law.

Sanctions are often designed to hurt a country's economy, or the
finances of individual citizens such as leading politicians. They can
include travel bans and arms embargoes.

They are among the toughest measures nations can use, short of going
to war.

British Prime Minister Boris Johnson told the Commons he was imposing
a series of measures:

The PM said "oligarchs in London will have nowhere to hide". He said
there was potential to cut Russia out from Swift financial messaging
service and that "nothing is off the table".

Similar financial sanctions will be extended to Belarus for its role
in the assault on Ukraine, he said.

The EU says it is preparing "massive and targeted sanctions" to block
Russia's access to technology and financial markets.

The US, UK, EU and others had already imposed limited sanctions after
Russia recognised the independence of two breakaway republics in
eastern Ukraine.

The measures targeted Russian banks and individuals, and took steps
to cut Russia out of financial markets.

German chancellor Olaf Scholz put on hold permission for the Nord
Stream 2 gas pipeline from Russia to Germany to open.

Western nations are lining up harsher sanctions. Options could
include:

Excluding Russia from Swift

One measure would be to exclude Russia from the financial messaging
service Swift. Ukraine has called for this to be done immediately.

Swift allows quick transactions and is used by 11,000 financial
institutions in 200 countries.

Banning Russia from it would delay the payments Russia gets for
exports of oil and gas.

When Swift banned Iran in 2012 - under pressure from the US - Iran
lost almost half of its oil export revenues and 30% of foreign trade.

However, a Russian senator warned that if Russia were blocked from
Swift, Europe might no longer be sent its oil and gas.

And Russia could focus on other customers and get paid through other
systems - for example, China's Cross-Border Interbank Payment System.

The US previously said it is unlikely to use Swift as an immediate
sanction and the EU is thought unlikely to do so.

Blocking Russian gas and oil exports

Oil and gas makes up a fifth of Russia's economy and half of its
earnings from exports.

As such, refusing to buy its oil and gas would be a very tough
sanction.

However, it would also be damaging to Western nations that rely on
it.

Russia supplies 26% of the EU's crude oil and 38% of its gas. Even a
brief cut in gas supply would raise energy prices.

Closing off Russia to the world

The US could ban Russia from transactions involving dollars by
introducing penalties for firms allowing it to do so. The UK has also
threatened to stop Russian companies using the pound.

Western nations could also ban exports of high-tech goods to Russia,
such as semiconductor microchips.

This would affect Russia's defence and aerospace sectors and
industries like car production.

The US, EU and UK have already blacklisted some Russian banks.

Blacklisting more of them might mean Moscow would face a big fall in
its currency, the rouble, and a financial crisis.

The Russian government would have to bail out the banking system, at
great expense. However, it has built up reserves of over $630bn
(£464bn) to deal with economic shocks.

The UK government could also take further action against Russian
money in London financial institutions and banks.

It says it is using "unexplained wealth orders", requiring people to
say where their cash has come from.

But only a handful of these orders have ever been used.

Every measure Western nations take against Russia could also affect
their own economies.

Hitting the Russian banking sector could damage firms which do
business in Russia, or have assets in its banks.

An export ban on high-tech goods would hit many Western
manufacturers.

Most importantly, Europe relies on Russia for 40% of its natural gas.

Russia's foreign ministry has threatened to introduce sanctions of
its own against the West. This may include reducing or shutting off
gas supplies to Europe.