The European Union is preparing a new wave of sanctions targeting Russia’s energy and financial sectors to increase pressure and encourage diplomatic negotiations. Central to the plan is a proposal to lower the existing price cap on Russian oil exports from $60 to $45 per barrel. This move aims to significantly reduce Russia’s oil revenues, which have been a vital source of funding for its war efforts in Ukraine.
EU foreign policy chief Kaja Kallas emphasized the importance of this financial blow, describing the lowered oil cap as a strategic effort to disrupt Moscow’s wartime economy. Alongside this, the EU intends to sanction the Nord Stream pipelines, currently non-operational due to sabotage in 2022, to prevent any future revenue generation and to signal a clear break from past energy dependence on Russia.
The new sanctions package requires unanimous approval from all 27 EU member states before it can be implemented. Although a $60 per barrel cap was introduced by Ukraine’s allies in 2023, it had limited practical effect since Russian crude often sold below this threshold. Nevertheless, the cap acted as a safeguard against potential price spikes.
Russia’s oil earnings have been crucial in sustaining its economy during the war, enabling continued military funding, controlling inflation, and stabilizing the ruble. However, European Commission President Ursula von der Leyen noted a sharp decline in Russia’s energy revenues from Europe, dropping from €12 billion monthly in early 2022 to just €1.8 billion currently.
Since Russia’s full-scale invasion of Ukraine in February 2022, the EU has imposed numerous sanctions on nearly 2,400 individuals and entities, including major institutions. The latest package, introduced on May 20, targeted a fleet of nearly 200 tankers used to evade sanctions and tightened controls on goods with potential military use.
With this new set of measures, the EU continues to escalate its economic response, aiming to weaken Russia’s ability to sustain its aggression and to bring the conflict closer to a diplomatic resolution.
