President of Ukraine

Strengthening energy sanctions can have a significant impact on the aggressor and bring the end of the war closer - Andriy Yermak

7 September 2023 - 21:03

The International Working Group on Sanctions Against Russia, co-chaired by Head of the Office of the President of Ukraine Andriy Yermak and former National Security Advisor to the President of the United States, Ambassador Michael McFaul, has prepared two new documents: on strengthening energy sanctions and on the importance of confiscating Russian state assets.

According to Andriy Yermak, energy sanctions are working, but they need to be significantly strengthened. According to him, in a new analytical document, the group provides detailed proposals for improving and strengthening the sanctions pressure on the energy sector of the aggressor country. The Head of the Office of the President emphasized that improving compliance with the sanctions and adopting the new proposals of the group would further reduce Russia's energy revenues by at least half.

"We have to be realistic: the aggressor is actively working to circumvent sanctions even through direct fraud, so we cannot let the Kremlin get back some of the lost revenue," said Andriy Yermak.

"According to our estimates, the sanctions are currently reducing Russia's revenues by about $5-7 billion a month. The sharp fall of the ruble confirms the problems in the economy. But this is absolutely not enough," said Vladyslav Vlasiuk, Secretary of the International Sanctions Group.

In his opinion, only improving the mechanisms for implementing the existing sanctions could further reduce Russia's oil and gas revenues by another $2-4 billion a month.

According to the published document, among other things, it is proposed to strengthen compliance with the oil price cap, in particular, to ensure that only traders from the "white list" can be issued price confirmations for Russian oil cargoes. It is also proposed to limit Russia's use of its shadow fleet. To do this, it is planned to require all tankers transiting through environmentally sensitive European territorial waters to confirm that they have proper oil spill insurance.

According to Andriy Yermak, in the second document, the International Sanctions Group explains the importance of confiscating Russia's international reserves frozen by leading countries.

"The arguments against confiscation do not stand up to any professional criticism, and the international expert group explains this in detail," said the Head of the Presidential Office.

According to him, Russia invaded Ukraine for no legitimate reason, and the aggressor must pay for all war crimes - mass murder, torture, rape, the complete destruction of dozens of settlements, the daily deliberate destruction of civilian infrastructure, and the abduction of tens of thousands of our children.

Advisor to the Head of the Presidential Office Daria Zarivna emphasized that the Central Bank's reserves should be the first and most appropriate target. They are highly liquid and are the undisputed property of the Russian Federation, whose government ordered the invasion of Ukraine. Therefore, the Russian government must pay for the recovery of Ukraine with the Central Bank's funds.

According to the authors of the document, the proposed process of confiscation of Russian state funds is not only completely ethical, but also legally binding in accordance with the principle of international law on state responsibility.

Ukraine has proposed to its partners the concept of a special international compensation mechanism. It will provide for the establishment and operation of an international register of losses, an international commission that will review applications and award compensation, and a compensation fund from which payments will be made. This mechanism was proposed on the basis of the UN General Assembly resolution of November 14, 2022.