Since Putin’s brutal invasion of Ukraine, the international community has responded remarkably fast to impose vital sanctions on his regime. But it is not enough and revenues continue to pour into Russia.
Here we lay out our five-point plan, calling for the most urgent expansions to the current sanctions regime that must be imposed immediately to cut off the money that fuels Putin’s war machine.
- 1. Disconnect Russian and Belarussian banks from SWIFT
All Russian and Belarussian banks must be disconnected from the SWIFT network immediately. By cutting them off from the financial transfer system, banks would be forced to deal directly with one another, delaying transactions, increasing costs and decreasing revenues for Putin’s government.
So far, only a few banks have been removed from the network. Notably missing from the list are main banks that handle Russian oil and gas transactions, such as the country’s largest bank, Sberbank, or Gazprombank. Without a comprehensive ban, the disconnected Russian banks are likely to use those Russian banks that still have access to SWIFT as intermediaries.
- 2. Ban on exports of critical products to Russia that support Putin’s war machine
There must be a worldwide, universal export ban aimed at cutting off Russia from critical technology and dual use items needed to power its military and economy. Halting direct technological exports of foreign products like semiconductors, computers, lasers, and telecommunications equipment is critical for curtailing Russian industries including defense, aerospace and shipping, freezing Russia’s technology stock in where it is today.
- 3. Full-spectrum energy export embargo
We demand an immediate embargo on all Russian oil exports, and aggressive, meaningful plans to reduce reliance on Russian gas. If the international community is serious about punishing Russia for its assault on Ukraine and doing so in a way that has a chance of forcing Putin to compromise, a full-spectrum energy export embargo must be the keystone sanction. Each day, Russia transports around 600,000 tons of its “blood oil” through the Bosporus alone. Six hundred thousand tons of Russian oil costs around $68 million, which is equivalent to the cost of 60 of the Russian Kalibr cruise missiles that are obliterating Ukrainian cities.
- 4. Closure of ports
Countries must deny entry to ports to all ships that are Russian owned, operated, controlled, chartered, registered, or flagged. Following restrictions on air traffic, tightening sea restrictions is a step that would further hamper Russia’s commercial shipments and would be an appropriate response to Russia’s flagrant violations of international maritime law since its invasion of Ukraine. Russia has attacked three foreign commercial ships – flying the flags of Panama, Bangladesh, and Moldova – near Ukrainian ports, and sunk an Estonian cargo ship near Odessa. Russia has also seized two Ukrainian ships with civilian crews in Romanian territorial waters.
- 5. Personal sanctions against individuals connected to Putin
Targeting specific members of the Putin’s inner circle, security establishment and oligarchs will limit their ability to reap the benefits of self-enrichment afforded by Putin’s regime, undermining a key pillar of the Kremlin’s offer to elites in exchange for compliance. There has been a flurry of individuals added to sanctions list in recent weeks, but many of the most politically sensitive options are left untouched, despite being the most impactful.
The international community has been tentative in applying crony/oligarch sanctions so far by only targeting a few top-level tycoons, hoping to drive a wedge between the billionaires and Putin. The U.S. Justice Department on Wednesday launched a task force known as “KleptoCapture” aimed at straining the finances of Russia’s oligarchs. These billionaires and officials, especially those closest to Putin and the Kremlin, present attractive targets for sanctions due to their involvement in the Russian economy and in Putin’s peculiar kleptocracy. Sweeping, wide-ranging individual sanctions can help sow uncertainty and panic in Russian markets and further diminish confidence in the Russian economy. Full sanctions on ALL Putin’s cronies and subordinates will leave them in no doubt that the dictator is now a direct threat to their own interests.