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UK looking to target Russia's energy sector in new sanctions

UK looking to target Russia's energy sector in new sanctions
UK looking to target Russia's energy sector in new sanctions   -   Copyright  Thomson Reuters 2022
By Reuters

By Andrew MacAskill and Kylie MacLellan

LONDON -Britain will look to target Russia’s energy sector in future rounds of sanctions, a move the government has so far resisted amid warnings this could push up energy bills with oil and gas prices already at multi-year highs.

Since Russia’s invasion of Ukraine last week, Britain has imposed a ban on Russia selling debt in its capital markets and targeted several Russian banks with sanctions, as well as companies like defence firm Rostec and airline Aeroflot.

“We’ve been very coordinated on sanctions, we’ve shown huge unity. It’s having a big effect in Russia, but we now need to do more,” Liz Truss, Britain’s foreign minister, said during a visit to Brussels for a meeting of NATO members.

“We particularly need to look at the oil and gas sector, how do we reduce our dependence across Europe on Russian gas, how do we cut off the funding to Vladimir Putin’s war machine?”

Numerous nations have imposed sweeping sanctions against Russian companies, banks and individuals following Russia’s invasion of Ukraine, although energy has largely been exempt to try and prevent prices spiralling even higher.

Despite that, the oil trade is in disarray, with producers postponing sales, importers rejecting Russian ships and buyers worldwide searching elsewhere for needed crude.

In Britain a ban on Russian ships docking in its ports, sanctions on banking and trade and a move to prevent Russian companies raising finance in London have indirectly impacted energy firms.

The likes of Gazprom have secondary London listings, and the London Stock Exchange (LSE) this week has suspended trading in Russian securities.

The United States and EU already have some sanctions in place on Russia’s energy and oil refining sectors, but Washington has been cautious on imposing sanctions on Russia’s oil and gas flows.

Russia is the second largest exporter of crude oil worldwide, trailing only Saudi Arabia.

Some of the world’s largest energy companies, such as BP and Shell, have also begun to abandon multibillion-dollar positions in Russia since the invasion began.