EU Approves Sixth Russia Sanctions Package, Including Phased Oil Embargo

Hungary, which earlier this week won a broad exemption from the oil embargo sanctions, opposed his inclusion on the sanctions list, leaving diplomats with the choice of holding up the whole package or agreeing to Hungarian Prime Minister Viktor Orban’s latest demand.

The centerpiece of the sixth package is an EU oil embargo that will cover 90% of the bloc’s oil purchases from Russia by the end of the year, EU officials say.

Under the measures, the EU will impose a phased-in ban on Russian crude and refined fuels that arrive on ships, which account for at least two-thirds of imports from Russia. By the end of the year, with Germany and Poland also pledging to stop buying oil via pipelines, the embargo should cover 90% of previous Russian oil imports.

By exempting pipelined oil, Hungary and several neighboring landlocked EU member states can still buy Russian oil and there is no deadline for the exemption. However EU leaders said when they met on Monday they would return to the issue of the exemption’s duration as soon as possible.

Meanwhile, the White House said Thursday the Biden administration was imposing additional sanctions on a group of Russian business officials and elites, including Sergei Roldugin, an associate and money-manager of Mr. Putin, and Mr. Roldugin’s family members; God Nisanov, an oligarch with close associate of several Russian officials; and Evgeny Novitskiy, a Russian businessman with ties to Mr. Putin’s government.

Other designations include Maria Zakharova, the spokeswoman of the Russian Ministry of Foreign Affairs; Sergey Gorkov, the head of RosGeo; and Alexey Mordashov, the leader of Severgroup LLC, along with his wife and two adult children.

“To be honest, I was sure that I had been on the American stop list for a long time,” Ms. Zakharova wrote on Telegram. “I don’t have foreign accounts or anything like that. Real estate either”

The administration said the new sanctions would also cover Putin-linked yachts and Kremlin-aligned yacht brokerages including Imperial Yachts and its chief executive; government ministers who oversee sectors of the Russian economy; and the president of United Aircraft Corp., a state-owned company that supports the Russian defense industry.

Hungary had held up the EU’s sixth sanctions package for weeks, seeking more time and assistance to wean the country off Russian energy flows.

Mr. Orban, who enjoys warm ties with Mr. Putin, had been lobbying for weeks for Patriarch Kirill to be excluded from a proposed sanctions list targeting Russian officials tied to the Kremlin, arguing that sanctions should not target religious leaders.

However he didn’t mention the issue at this week’s EU leaders summit, two diplomats said. All EU sanctions need the backing of the bloc’s 27 member states.

“Today, the only way to oppose the Hungarians was to block the adoption of the whole package,” said a senior EU diplomat who participated in the discussion of EU ambassadors on the sanctions, which took place in Luxembourg. That “would be shooting ourselves in the feet and betraying Ukrainians.”

Zoltan Kovacs, Mr. Orban’s international spokesman, cited the Hungarian prime minister saying that the EU’s other member states had long known Hungary’s position on the proposed sanctions against Patriarch Kirill.

On Twitter, he wrote, “No one in the Brussels summit stood up against it,” he cited Mr. Orban saying.

The sanctions package, first proposed a month ago by the bloc’s executive body, also blocks insurers from covering cargoes of Russian crude, a measure that is expected to be phased in over the next six months. These sanctions could undercut Russia’s efforts to sell its oil in Asia. European companies insure most of the world’s oil trade.

The oil embargo is a high-risk strategy for the EU, forcing the bloc to break its dependency on cheap Russian energy. It is likely to fuel inflation already running at the highest pace in decades on both sides of the Atlantic.

After long and fraught negotiations over the embargo, the approval of the sixth sanctions package has managed to preserve its unity in the face of Russia’s invasion of Ukraine. But the oil dispute has also exposed the limits of the EU’s ability to divorce itself from Russia’s energy exports, which help fund Moscow’s budget and its war effort.

EU officials say there are no plans for more major sanctions against Russia before the summer, and that sanctions on Russian gas are off the table for now.

Also included in the sanctions package is fresh measures against Russian banks, with

Sberbank,

the country’s biggest bank, to be knocked off the Swift financial transactions network.

Three of Russia’s largest broadcasters will be forbidden from operating in the EU and there will be targeted sanctions against military officials involved in the siege of Mariupol and other high profile figures, including

Alina Kabaeva,

a retired Olympic rhythmic gymnast who several Western governments believe to be Mr. Putin’s girlfriend.

—Ken Thomas in Washington contributed to this article.

Write to Laurence Norman at [email protected]

Hungary, which earlier this week won a broad exemption from the oil embargo sanctions, opposed his inclusion on the sanctions list, leaving diplomats with the choice of holding up the whole package or agreeing to Hungarian Prime Minister Viktor Orban’s latest demand.

The centerpiece of the sixth package is an EU oil embargo that will cover 90% of the bloc’s oil purchases from Russia by the end of the year, EU officials say.

Under the measures, the EU will impose a phased-in ban on Russian crude and refined fuels that arrive on ships, which account for at least two-thirds of imports from Russia. By the end of the year, with Germany and Poland also pledging to stop buying oil via pipelines, the embargo should cover 90% of previous Russian oil imports.

By exempting pipelined oil, Hungary and several neighboring landlocked EU member states can still buy Russian oil and there is no deadline for the exemption. However EU leaders said when they met on Monday they would return to the issue of the exemption’s duration as soon as possible.

Meanwhile, the White House said Thursday the Biden administration was imposing additional sanctions on a group of Russian business officials and elites, including Sergei Roldugin, an associate and money-manager of Mr. Putin, and Mr. Roldugin’s family members; God Nisanov, an oligarch with close associate of several Russian officials; and Evgeny Novitskiy, a Russian businessman with ties to Mr. Putin’s government.

Other designations include Maria Zakharova, the spokeswoman of the Russian Ministry of Foreign Affairs; Sergey Gorkov, the head of RosGeo; and Alexey Mordashov, the leader of Severgroup LLC, along with his wife and two adult children.

“To be honest, I was sure that I had been on the American stop list for a long time,” Ms. Zakharova wrote on Telegram. “I don’t have foreign accounts or anything like that. Real estate either”

The administration said the new sanctions would also cover Putin-linked yachts and Kremlin-aligned yacht brokerages including Imperial Yachts and its chief executive; government ministers who oversee sectors of the Russian economy; and the president of United Aircraft Corp., a state-owned company that supports the Russian defense industry.

Hungary had held up the EU’s sixth sanctions package for weeks, seeking more time and assistance to wean the country off Russian energy flows.

Mr. Orban, who enjoys warm ties with Mr. Putin, had been lobbying for weeks for Patriarch Kirill to be excluded from a proposed sanctions list targeting Russian officials tied to the Kremlin, arguing that sanctions should not target religious leaders.

However he didn’t mention the issue at this week’s EU leaders summit, two diplomats said. All EU sanctions need the backing of the bloc’s 27 member states.

“Today, the only way to oppose the Hungarians was to block the adoption of the whole package,” said a senior EU diplomat who participated in the discussion of EU ambassadors on the sanctions, which took place in Luxembourg. That “would be shooting ourselves in the feet and betraying Ukrainians.”

Zoltan Kovacs, Mr. Orban’s international spokesman, cited the Hungarian prime minister saying that the EU’s other member states had long known Hungary’s position on the proposed sanctions against Patriarch Kirill.

On Twitter, he wrote, “No one in the Brussels summit stood up against it,” he cited Mr. Orban saying.

The sanctions package, first proposed a month ago by the bloc’s executive body, also blocks insurers from covering cargoes of Russian crude, a measure that is expected to be phased in over the next six months. These sanctions could undercut Russia’s efforts to sell its oil in Asia. European companies insure most of the world’s oil trade.

The oil embargo is a high-risk strategy for the EU, forcing the bloc to break its dependency on cheap Russian energy. It is likely to fuel inflation already running at the highest pace in decades on both sides of the Atlantic.

After long and fraught negotiations over the embargo, the approval of the sixth sanctions package has managed to preserve its unity in the face of Russia’s invasion of Ukraine. But the oil dispute has also exposed the limits of the EU’s ability to divorce itself from Russia’s energy exports, which help fund Moscow’s budget and its war effort.

EU officials say there are no plans for more major sanctions against Russia before the summer, and that sanctions on Russian gas are off the table for now.

Also included in the sanctions package is fresh measures against Russian banks, with

Sberbank,

the country’s biggest bank, to be knocked off the Swift financial transactions network.

Three of Russia’s largest broadcasters will be forbidden from operating in the EU and there will be targeted sanctions against military officials involved in the siege of Mariupol and other high profile figures, including

Alina Kabaeva,

a retired Olympic rhythmic gymnast who several Western governments believe to be Mr. Putin’s girlfriend.

—Ken Thomas in Washington contributed to this article.

Write to Laurence Norman at [email protected]