US Expands Sanctions on Russia, Targeting Trade and Financial Transactions

The new measures target companies in countries such as China in a bid to “discourage” trade with Moscow

On Wednesday, the US Departments of State and Treasury imposed sanctions on an additional 300 individuals and entities in Russia and globally, which they claim are linked to Moscow’s “war economy.”

According to the Treasury Department, the latest measures target individuals and companies suspected of aiding Moscow in circumventing the Western embargo.

“Today’s actions strike at their remaining avenues for international materials and equipment, including their reliance on critical supplies from third countries,” said Treasury Secretary Janet Yellen.

“We are increasing the risk for financial institutions dealing with Russia’s war economy and eliminating paths for evasion, and diminishing Russia’s ability to benefit from access to foreign technology, equipment, software, and IT services.”

The two departments have issued a new interpretation of existing executive orders that prohibit US citizens from providing anyone in Russia with “IT consultancy and design services,” as well as “IT support services and cloud-based services for enterprise management software and design and manufacturing software.”

The Department of Treasury has also redefined Russia’s military-industrial base to include all persons sanctioned under Executive Order 14024 – including Sberbank and VTB – meaning that third-country financial institutions “risk being sanctioned for conducting or facilitating significant transactions, or providing any service” to them.

The Treasury estimates that Wednesday’s measures target over $100 million in trade between Russia and its foreign partners. Companies and individuals in China, Kyrgyzstan, and Türkiye were added to the sanctions list, with the US targeting entities in east and central Asia, Africa, the Middle East, and the Caribbean.

Since February 2022, Washington has sanctioned over 4,000 Russian individuals and companies, aiming to hinder the country’s military operations against Kyiv. The US action precedes the G7 summit in Italy, where Washington had hoped to announce progress on the seizure of frozen Russian sovereign assets. However, the US and its EU allies have reportedly struggled to agree on the next step.

Moscow “will not leave the aggressive actions of the US unanswered,” stated Russian Foreign Ministry spokeswoman Maria Zakharova in response to Washington’s announcement.

In response to the new US sanctions, the Moscow Stock Exchange has announced that it will halt trading in US dollars and euros starting Thursday.