Home MarketsEurope & Middle East 14th EU sanctions package should focus on circumvention and energy exports, says Zelenskyy adviser

14th EU sanctions package should focus on circumvention and energy exports, says Zelenskyy adviser

by SuperiorInvest

The Floating Storage Regasification Unit (FSRU) ship 'Hoegh Esperanza' is guided by tugboats during its arrival at the port of Wilhelmshaven, Germany, December 15, 2022.

Fabian Bimmer | AFP | fake images

The European Union's upcoming 14th sanctions package against Russia must do more to stifle energy exports and clamp down on circumvention by third parties, an adviser to Ukrainian President Volodymyr Zelenskyy's office told CNBC.

Vladyslav Vlasiuk said it was also vital to strengthen export controls on critical technologies used in Moscow's military equipment. He noted that EU states would need to work more cohesively to give sanctions a chance to cross the line at the end of next month as planned.

“The most critical aspect of the 14th sanctions package is its adoption at the end of June, but some Member States are currently raising a challenge to this,” Vlasiuk said by email on Thursday.

The EU's special envoy for sanctions implementation, David O'Sullivan, was in kyiv on Thursday to discuss the latest sanctions package amid continued opposition from member states such as Hungary. Among the proposed measures is a ban on Russian exports of liquefied natural gas, or LNG, and a crackdown on sanctions circumvention through countries such as Kremlin ally Belarus.

The new energy proposals would not prevent Russian imports of LNG into the EU, but would prevent the bloc from re-exporting it to other markets, stifling a key trade route for Russia.

Nataliia Shapoval, a member of the Yermak-McFaul International Working Group on Russian Sanctions, a think tank that advises on EU sanctions, said the LNG proposals were an attempt to restrict Russia's current and future energy revenues.

“LNG is the influence that Russia still maintains,” Shapoval, who is also director of the KSE Institute, said by phone.

Russia said on Wednesday that such a ban would hurt the EU more than Russia, and that some LNG supplies were already being redirected to China and India.

“The ban on imports and transit that is currently being discussed within the framework of the EU structures, will lead to another round of rising raw material prices, including for European consumers, financial costs for European companies , will create new risks for international energy security, and will negatively affect the functioning of transport and logistics corridors,” said Dmitry Birichevsky, director of the economic cooperation department of the Russian Foreign Ministry, according to a report translated by Google from the Russian news agency Ria Novosti.

Shapoval noted, however, that gas supplies were much more difficult to direct without European infrastructure than, for example, oil. The ports of France, Belgium and Spain are essential for gas transshipment to Asia.

Read more CNBC political coverage

He added that the EU was currently playing a “cat and mouse game” to determine which critical components underpinned Moscow's military power and should therefore be banned.

“There is this process of searching all the components used in military capabilities to find the choke point,” Shapoval said.

Previous sanctions packages from the EU and its allies have sought to prevent the supply of critical technologies and so-called dual-use goods (which have both civilian and military uses) to Russia through third parties, most notably China. Still, Shapoval said more needs to be done to target third countries that support Russia.

“There are currently multiple gaps. It is a widely known challenge,” he said.

Source Link

Related Posts