Explained | The major financial and commercial sanctions on Russia

Sanctions imposed on Russia are both financial and economic. It bothers the country’s undertakings in the energy, defence technology and aviation realms.

March 08, 2022 01:05 pm | Updated 09:27 pm IST

A worker put a lid on a pipe at the construction site of the Nord Stream 2 gas pipeline in Lubmin, northeastern Germany. German Chancellor Olaf Scholz said on February 22, 2022 that he was suspending the Nord Stream 2 pipeline project with Russia in response to Moscow’s recognition of two breakaway regions in Ukraine. File

A worker put a lid on a pipe at the construction site of the Nord Stream 2 gas pipeline in Lubmin, northeastern Germany. German Chancellor Olaf Scholz said on February 22, 2022 that he was suspending the Nord Stream 2 pipeline project with Russia in response to Moscow’s recognition of two breakaway regions in Ukraine. File | Photo Credit: AFP

Owing to its geopolitical actions in the Ukraine, Russia has been the subject of a wide spectrum of financial and economic sanctions from the West. The sanctions are not just restricted to the President and the Duma, but extends to Russian individuals and companies operating in the energy, aviation and defence technology realms.

It has been excluded from the SWIFT financial system, which has restricted its ability to avail foreign exchange, further bothering the domestic currency and economy.


The European Union (EU) on February 25 introduced an export ban on Russia pertaining to equipment and technologies relevant to oil refining and related services. The European body argued the move would “make it impossible” for Russia to upgrade its oil refineries. As per its data, Russia’s export revenue stood at €24 billion in 2019.  

White House, earlier in March, stated that the Commerce Dept also instituted restrictions on technological exports that could potentially support Russia’s refining capacity in the long term. It described refining as a key pillar supporting the Russian military. “The United States and our Allies and partners do not have a strategic interest in reducing the global supply of energy – which is why we have carved out energy payments from our financial sanctions. But we and our Allies and partners share a strong interest in degrading Russia’s status as a leading energy supplier over time,” the statement read.  

North American oil and gas company ExxonMobil opted to discontinue its Sakhalin-1 venture in Russia. Additionally, it communicated its decision of not investing in a new development in the country. 

London-based energy company BP opted to divest its 19.75% shareholding in the Russian company Rosneft. 


EU in February stated that member states would not permit Russian air carriers to land, take-off or overfly in their territories. Previously, it placed an export ban on goods and technology in the aviation and space industry alongside a prohibition on providing insurance, reinsurance and maintenance services to Russian aviation service providers.  

It also asked for a ban on sale of all aircrafts, spare parts and equipment to Russian airlines.  

U.S. also closed its airspace to all Russian airline operators.  

According to EU estimates, three quarters of Russia’s commercial fleet was built in the EU, the U.S. and Canada. Additionally, the White House had stated, “With this action, the United States stands with over 30 of the world’s most important aviation markets in denying Russian carriers the ability to conduct business.”  

Defence technology 

The White House in February imposed restrictions on export of technological items relevant to Russia’s military end users, including the Russian Ministry of Defence and Armed Forces of Russia. It would include all items produced in the country and those made in foreign countries using certain U.S.-origin software, technology or equipment. These would concern semiconductors, telecommunication systems, encryption systems, lasers, sensors, navigations systems, avionics and maritime technologies. 

Separately, the U.S. had announced that it would place entities found helping Russian and Belarusian security services to its Entity List. Entity List contains the name all individuals and organisation (Govt/Non-Govt) subject to certain specific license requirement other than the ones listed by the Dept of Commerce’s export regulations.

“These actions will ensure that the military as well as the aerospace, maritime and high-technology sectors do not obtain U.S. technology goods and technology that can be used to support Russian technical maintenance and innovation,” the statement read.

EU too issued similar issued regulations prohibiting the export of products as semi-conductors or cutting-edge technology to Russia.  

Broadcasting, Commerce and Internet 

On March 2, the EU suspended broadcast of Sputnik and Russia Today. It stated, “... (the entities) are essential and instrumental in bringing forward and supporting the military aggression against Ukraine, and for the destabilisation of its neighbouring countries”. The union added the broadcasting units engaged in a systematic, international campaign of disinformation, manipulation and distortion of facts to facilitate “its strategy of destabilisation of its neighbouring countries”.

Nike’s online store in Russia confirms its unserviceability in the region. Its peer in the sportswear segment, Adidas suspended its partnership with Russian football federation.  Nike and Adidas are part of the league of international consumer companies who have opted to pause their operations in the region, such as Apple, Samsung, Electronic Arts, IKEA, H&M, Honda, Ford and Dell. 

Technology companies as Oracle, Spotify, SAP and Microsoft have also suspended their operations in the country. Spotify added that it is working on removing all Sputnik and Russia Today content from its platforms in the EU and elsewhere. News agency Reuters reported on Thursday that Google had stopped selling online advertising in Russia. The ban would extend across all its platforms as search, YouTube and outside publishing partners. It added that the move was similar to the ones instituted by Twitter and Snap. 

Visa and MasterCard on Saturday on Saturday ceased their operations in Russia. This would translate to Russian banks offering cards of the two companies being rendered dysfunctional. Additionally, cards issued outside the jurisdiction would not work in Russia.

Individual sanctions 

On Feb 25, the EU sanctioned Russian President Vladimir Putin and Minister of Foreign Affairs Sergey Lavrov. This followed Russia’s recognition of Lugansk and Donetsk. The union added that it would impose restrictive measures on the members of the Russian National Security Council along with the members of the Duma for supporting the move.  

White House on Feb 2 sanctioned Director of the Federal Security Reserve of Russia Aleksander Bortnikov, CEO of the Russia-bank Promsvyazbank, Petr Fradkov and first Deputy Chief of Staff of the Russian Presidential Office Sergei Kiriyenko.  

Following which, it imposed sanctions on Special Presidential Representative for Environmental Protection, Ecology and Transport Sergei Ivanov, Secretary of the Russian Federation Security Council Nikolai Patrushev, VTB Bank executives Yurey Solviev and Andrey Puchkov and SberBank executive Alexander Vedyakhin.  

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