Thursday, 24 July, 2014

Published July 18, 2014
US slaps toughest sanctions yet on Russia
They strike at the heart of Putin's powerbase by targeting companies closest to him
BT 20140718 SANCTIONS18 1182411

Hard hit: Penalties have been imposed on Rosneft, Novatek and Gazprombank, among others. - PHOTO: REUTERS

[MOSCOW] President Barack Obama imposed the toughest US sanctions yet on Russia, striking at the heart of Vladimir Putin's powerbase by targeting companies closest to him over what Washington says is Moscow's failure to curb violence in Ukraine.

By imposing penalties on Russia's largest oil producer Rosneft, its second largest gas producer Novatek and its third largest bank Gazprombank, Washington targeted Mr Putin's allies, many of whom have become wealthy during his tenure.

The sanctions, which in effect close medium and long-term US dollar funding, were also put on Vnesheconombank, VEB, a state-owned bank that acts as payment agent for the government, and eight arms firms, including the producer of the Kalashnikov assault rifle.

The sanctions did not freeze those four companies' assets, or stop US firms from doing business with them and several were quick to say it was business as usual. But Russia's rouble-traded stock market and the rouble tumbled on opening.