Far more than 20,000 sanctions – more than those directed against Iran, Venezuela, North Korea, and Cuba combined – have been imposed on Russia since the invasion in 2022.
Only the EU has introduced as many as 18 sanction packages. Oligarchs have had their assets frozen, price caps have been set for Russian oil, and Russian banks have been excluded from international payment systems.
Yet, Russia's GDP is rising and the country's richest are becoming even richer, according to the International Monetary Fund (IMF) and Forbes.
The next step
The sanctions are not enough, states Maria Perrotta Berlin, researcher at the Institute for Economic Studies in Eastern Europe at the Stockholm School of Economics. They have limited Russia's resources and access to capital, but not as much as desired.
The sanctions are large and powerful, but they have always come a little too late. Russia has had time to adapt, found ways to circumvent them, and so we must find ways to plug the loopholes. We are always one step behind.
Prior to Friday's Trump-Putin meeting in Alaska, Trump has threatened with "serious disruption" to Russia's war economy if Putin does not agree to a ceasefire. Likely, it is about sanctions against the Russian shadow fleet, which is used to circumvent the G7's price cap on Russian oil, as well as sanctions against countries that still trade with Russia – not least China and India.
"Will burst"
Maria Perrotta Berlin is positive. The existing sanctions against the shadow fleet have proven effective, and sanctions against third countries are "the right way to go". But she believes that cooperation would have worked better than confrontation.
If one takes a hard line against India and China, it may backfire, with countermeasures from them, and then one will be forced to back down. We have seen Trump already do this in several rounds.
Then everything falls – and then perhaps Russia will not think that it is credible either.
Neither current nor future sanctions will put an end to the war tomorrow, summarizes Perrotta Berlin. But when Russia no longer gets more money from outside – and the war continues to cost a lot – the Kremlin's wallet will eventually run out.
When one puts less money into everything else – education, healthcare, pensions – it will burst at some point. And it is because of the sanctions.
As a result of Russia's invasion of Ukraine in 2022, the EU and the US, among others, have introduced sanctions against Russia, which mainly target oil and gas.
Among other things, the US and Canada have banned all imports of Russian oil and gas. The EU has introduced measures that in practice should stop 90 percent of imports, with some exceptions for countries in the east that have become dependent on pipelines from Russia.
Before the war, the EU bought nearly half of Russia's exported oil. Today, it is about five percent.
All imports of oil by sea have been banned. In cooperation with the G7, a price cap of $60 per barrel of crude oil was introduced in December 2022, where ships carrying more expensive Russian oil are denied access to Western ports and insurance. The price cap was lowered in July this year to $47.6 per barrel.
However, since the price cap was introduced, Russia has circumvented it through its so-called "shadow fleet" of aging tankers that have changed flags to countries that do not follow the sanctions. In this way, Russia has been able to circumvent the restrictions and continue to sell large quantities of crude oil to countries such as India and China.
