The United States yesterday stepped up the severity of its economic sanctions against Russia in response that nation's military incursions into Ukraine. President Obama also opened the door to future sanctions against Russia's oil and natural gas industries, which account for a large portion of Russia's exports.
Obama said the prospective energy sanctions are not his "preferred outcome" because they could disrupt the global economy, but he said they might become necessary because of "menacing movements by the Russian military near eastern and southern Ukraine," according to a New York Times report.
Europe in particular depends heavily on imported Russian natural gas that comes to it via a network of pipelines that traverse Ukraine. But Europe's reliance on the Ukrainian pipelines has declined in recent years because Russia has built three pipelines into Europe that bypass Ukraine to the north and south.
During the CERAWeek briefing on the Ukraine crisis, an exchange between IHS Vice Chairman Daniel Yergin and Michael Stoppard drove home the fact that some European nations would be reluctant to back the United States if it imposes energy-related sanctions on Russia.
Yergin: "Given how integrated Europe is with Russia economically and vice versa—and it's so different for the United States with the talk about sanctions and so forth—can we expect Europe to approach this differently?"
Stoppard: "I think that because of the interests, and the importance of the gas trade, we are going to see a very cautious approach from Europe, yes."
