The Economist: EU sanctions to still impact Russia, even if US eases restrictions

European restrictive measures will remain in place to inflict significant financial damage on the Russian economy even if the U.S. lifts its sanctions, The Economist reports, citing its own research.

“Without Europe on side [eds. aligned or in favor], Russia’s trade, access to payment systems and foreign investment would all remain severely limited,” the article reads.

Easing of U.S. sanctions could revive trade between Russia and the US, which has plummeted by 90 percent from 2021 to 2024. Before Russia’s full-scale invasion of Ukraine, trade volume stood at $35 billion, a relatively small amount.

In contrast, pre-war trade between Russia and the EU amounted to $305 billion, meaning its restoration would have a much larger impact, analysts argue.

Even if the US were to lift sanctions on energy resources and fertilizer products, it would not provide significant relief to the Kremlin, the article suggests. 

Moscow has already found ways to circumvent the restrictions: despite G7 sanctions and the blocking of 155 tankers, oil exports have rebounded to 3.5 million barrels per day, surpassing 2021 levels.

Moreover, since 2022, Russia has been sidestepping export restrictions by using counterfeits from China and rerouting goods through Central Asia. High-tech equipment and dual-use goods, once supplied by Europe, now primarily come from the US. 

However, a ban on exporting weapons components may still persist.

In terms of international payments, Russia continues to face challenges due to the exclusion of its banks from Mastercard, Visa, and SWIFT, making currency repatriation from China and India more difficult and blocking access to €274 billion in assets from Russia’s Central Bank.

“If American sanctions ended, such problems would ease but not vanish,” the article reads.

Meanwhile, the European Union remains committed to maintaining pressure on Russia through sanctions, as it sees this as “the best way to support Ukraine is to stay consistent in our objective to reach a just and lasting peace,” said European Council President António Costa on March 27.