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    Biden Officials Weigh Russian Oil Ban as Gas Prices Soar

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    Global stocks dipped on Monday as U.S. officials discussed an oil cutoff, and gas prices hit a national average above $4, up more than 10 percent in a week.WASHINGTON — President Biden came under pressure on Monday to ban Russian oil imports into the United States, forcing the administration to consider action that could further punish President Vladimir V. Putin of Russia but exacerbate high gas prices that are hurting consumers at home.On Monday, a bipartisan group of American lawmakers agreed to move ahead with legislation that would ban Russian energy imports in the United States and suspend normal trade relations with Russia and Belarus. Some European countries, which are highly dependent on Russian energy, have expressed a willingness to reduce their reliance on those imports.Jen Psaki, the White House press secretary, said that “no decision has been made at this point by the president about a ban on importing oil from Russia,” adding that discussions were “ongoing internally” and with European allies.“I would note what the president is most focused on is ensuring we are continuing to take steps to deliver punishing economic consequences while taking all actions necessary to limit the impact of prices at the gas pump,” she said.Global stocks slid on Monday amid worries of an oil ban and escalating Russian attacks on Ukraine. It was Wall Street’s worst day in more than a year.The S&P 500 fell 3 percent, its sharpest daily decline since October 2020. The Nasdaq composite dropped 3.6 percent and is now 20 percent off its November record, entering territory known on Wall Street as a bear market, denoting a serious downturn.The Biden administration, along with its global allies, has already imposed sweeping financial, trade and technology sanctions on Russia, but Western countries have deliberately carved out its energy sector, with top U.S. officials saying it would be unwise to disrupt global supplies given how heavily Europe relies on Russian oil and gas. Some officials also view the move as potentially enriching Mr. Putin by driving up gas prices. The average price in the United States reached a national average of $4.07 per gallon on Monday, up more than 10 percent from a week ago.At his State of the Union speech last week, Mr. Biden talked about the economy’s strength but noted that high gas prices, along with rapid inflation, are hurting consumers. Those dynamics pose a political problem for the president, whose approval rating has suffered amid voter concerns about his handling of the economy.Mr. Biden spoke with the leaders of Britain, France and Germany by video on Monday, and the four “affirmed their determination to continue raising the costs on Russia for its unprovoked and unjustified invasion of Ukraine,” according to a White House statement.But that cross-border cooperation could stop with oil. Chancellor Olaf Scholz of Germany said his country could not simply turn off the spigot.“Europe has deliberately exempted energy supplies from Russia from sanctions,” he said in a statement on Monday. “At the moment, Europe’s supply of energy for heat generation, mobility, power supply and industry cannot be secured in any other way.”Biden administration officials say the immediate discussions over Russian energy are focused on banning domestic oil imports rather than carrying out wider sanctions that would cut off purchases by other countries. That could lessen the economic shock to oil markets given the United States does not import much Russian crude.Last fall, it imported about 700,000 barrels per day from Russia, less than 10 percent of its total oil imports, U.S. officials said. By contrast, Europe imported 4.5 million barrels per day from Russia, about one-third of its total imports. The United States can easily find a way to make up for any loss of Russian oil, while Europe would have a harder time doing so, analysts said.But any disruption in the flow of oil could further rattle global markets, including oil prices, which have surged because of the uncertainty over Mr. Putin’s invasion of Ukraine. Brent crude, the global benchmark, ended Monday up about 4.3 percent to $123.21 a barrel, but earlier it had climbed as high as $139 a barrel. The price of oil has soared about 26 percent over the past week as the conflict has intensified.In a sign of how concerned the administration is about the uncertainties around global energy flow, American officials have been discussing the possibility of increasing supply or distribution with their counterparts in oil-producing nations, including Saudi Arabia and Venezuela, which is a partner of Russia and has been subject to broad U.S. sanctions for years.On Feb. 15, more than one week before Mr. Putin’s invasion of Ukraine, Mr. Biden said in a speech that a conflict involving Russia could affect American consumers. “I will not pretend this will be painless,” he said. “There could be impact on our energy prices, so we are taking active steps to alleviate the pressure on our own energy markets and offset rising prices.”It is unclear how much pain an import ban would actually inflict on Russia. Moscow could try to make up for import bans by arranging to sell more oil to other customers, including China.China is Russia’s most powerful strategic partner, and it has supported Moscow’s grievances against the United States and NATO during the war in Ukraine. On Monday, the Chinese foreign minister, Wang Yi, said at a news conference in Beijing that “no matter how perilous the international landscape, we will maintain our strategic focus and promote the development of a comprehensive China-Russia partnership in the new era.”Customers like China would have leverage to bargain down the purchase price, so Russia might still face a shortfall in revenue.Russia-Ukraine War: Key Things to KnowCard 1 of 4A humanitarian crisis. More

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    With Sanctions, U.S. and Europe Aim to Punish Putin and Fuel Russian Unrest

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    The Biden administration and European officials are crushing the Russian economy and stirring mass anxiety to pressure President Vladimir V. Putin to end his war in Ukraine.WASHINGTON — As they impose historic sanctions on Russia, the Biden administration and European governments have set new goals: devastate the Russian economy as punishment for the world to witness, and create domestic pressure on President Vladimir V. Putin to halt his war in Ukraine, current and former U.S. officials say.The harsh penalties — which have hammered the ruble, shut down Russia’s stock market and prompted bank runs — contradict previous declarations by U.S. officials that they would refrain from inflicting pain on ordinary Russians. “We target them carefully to avoid even the appearance of targeting the average Russian civilian,” Daleep Singh, the deputy national security adviser for international economics, said at a White House briefing last month.The escalation in sanctions this week has occurred much faster than many officials had anticipated, largely because European leaders have embraced the most aggressive measures proposed by Washington, U.S. officials said.With Russia’s economy crumbling, major companies — Apple, Boeing and Shell among them — are suspending or exiting operations in the country. The Biden administration said on Thursday that it would not offer sanctions relief amid Mr. Putin’s increasingly brutal offensive.The thinking among some U.S. and European officials is that Mr. Putin might stop the war if enough Russians protest in the streets and enough tycoons turn on him. Other U.S. officials emphasize the goals of punishment and future deterrence, saying that the carcass of the Russian economy will serve as a visible consequence of Mr. Putin’s actions and a warning for other aggressors.But Russia’s $1.5 trillion economy is the world’s 11th largest. No countries have tried pushing an economy of that size to the brink of collapse, with unknown consequences for the world. And the actions of the United States and Europe could pave the way for a new type of great-power conflict in the future.The moves have also ignited questions in Washington and in European capitals over whether cascading events in Russia could lead to “regime change,” or rulership collapse, which President Biden and European leaders are careful to avoid mentioning.“This isn’t the Russian people’s war,” Secretary of State Antony J. Blinken said in a news conference on Wednesday. But, he added, “the Russian people will suffer the consequences of their leaders’ choices.”“The economic costs that we’ve been forced to impose on Russia are not aimed at you,” he said. “They are aimed at compelling your government to stop its actions, to stop its aggression.”The harshest sanctions by far are ones that prevent the Central Bank of Russia from tapping into much of its $643 billion in foreign currency reserves, which has led to a steep drop in the value of the ruble. Panic has set in across Russia. Citizens are scrambling to withdraw money from banks, preferably in dollars, and some are fleeing the country.The United States and Europe also announced new sanctions this week against oligarchs with close ties to Mr. Putin. Officials are moving to seize their houses, yachts and private jets around the world. French officials on Thursday snatched the superyacht of Igor Sechin, the chief executive of Rosneft, the Russian state oil giant.“The sanctions have turned out to be quite unprecedented,” said Maria Snegovaya, a visiting scholar at George Washington University who has studied U.S. sanctions on Russia. “Everybody in Russia is horrified. They’re trying to think of the best way to preserve their money.”The French finance minister, Bruno Le Maire, has used some of the harshest language yet to articulate the mission, telling a radio program on Tuesday that Western nations were “waging an all-out economic and financial war on Russia” to “cause the collapse of the Russian economy.” He later said he regretted his words.Evidence of shock and anger among Russians — mostly anecdotal in a country with restricted speech and little public opinion polling — has raised the specter of mass political dissent, which, if strong enough, could threaten Mr. Putin’s grip on power.Senator Lindsey Graham, Republican of South Carolina, said on Fox News, “The best way for this to end is having Eliot Ness or Wyatt Earp in Russia, the Russian Spring, so to speak, where people rise up and take him down.”Mr. Graham added: “So I’m hoping somebody in Russia will understand that he’s destroying Russia, and you need to take this guy out by any means possible,” reiterating his Twitter post on Thursday calling for an assassination of Mr. Putin.A spokesman for Prime Minister Boris Johnson of Britain said on Monday that the sanctions were “intended to bring down the Putin regime.” Mr. Johnson’s office quickly corrected the statement, saying that it did not reflect his government’s view and that the goal of the measures was to stop Russia’s assault on Ukraine.Michael A. McFaul, a former U.S. ambassador to Moscow, called the talk of Mr. Putin’s overthrow unhelpful, emphasizing that the sanctions should be tailored and described as a means of stopping the invasion. “The objective should be to end the war,” he said.But while the Biden administration has said it is still open to diplomacy with Russia, it has not offered to reverse any of the sanctions in exchange for de-escalation.“Right in this moment, they’re marching toward Kyiv with a convoy and continuing to take reportedly barbaric steps against the people of Ukraine,” Jen Psaki, the White House press secretary, said on Thursday. “So, no, now is not the moment where we are offering options for reducing sanctions.”But in an interview on Friday with the Russian news agency TASS, Victoria J. Nuland, the U.S. under secretary of state for political affairs, suggested terms for possible sanctions relief, albeit maximalist ones. She said that Mr. Putin had to end the war, help to “rebuild” Ukraine and recognize its sovereignty, borders and right to exist. Those are conditions that the Russian leader is highly unlikely to consider.Families in Kyiv, Ukraine, waited for a train west on Friday.Lynsey Addario for The New York TimesAll the while, Biden officials have sought to assure the Russian people that they take no pleasure in their suffering. The United States and Europe have tried to spare Russians some of the effects, including allowing sales of consumer technology to Russia despite sweeping new limits on exports.They have also refrained from imposing energy sanctions because of Europe’s dependence on Russian gas and the risk of higher oil prices.Even so, Mr. Putin and his aides are doing their best to find some political advantage in the sanctions, arguing that the real goal for the West has always been to weaken Russia. As he launched his invasion last week, Mr. Putin said the United States would have sanctioned his country “no matter what.”Russia-Ukraine War: Key Things to KnowCard 1 of 4Nuclear plant seized. More

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    Economic Ties Among Nations Spur Peace. Or Do They?

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    The Russian invasion of Ukraine strains the long-held idea that shared interests around business and commerce can deflect military conflict.Russia’s war in Ukraine is not only reshaping the strategic and political order in Europe, it is also upending long-held assumptions about the intricate connections that are a signature of the global economy.Millions of times a day, far-flung exchanges of money and goods crisscross land borders and oceans, creating enormous wealth, however unequally distributed. But those connections have also exposed economies to financial upheaval and crippling shortages when the flows are interrupted.The snarled supply lines and shortfalls caused by the pandemic created a wide awareness of these vulnerabilities. Now, the invasion has delivered a bracing new spur to governments in Europe and elsewhere to reassess how to balance the desire for efficiency and growth with the need for self-sufficiency and national security.And it is calling into question a tenet of liberal capitalism — that shared economic interests help prevent military conflicts.It is an idea that stretches back over the centuries and has been endorsed by romantic idealists and steely realists. The philosophers John Stuart Mill and Immanuel Kant wrote about it in treatises. The British politicians Richard Cobden and John Bright invoked it in the 19th century to repeal the protectionist Corn Laws, the tariffs and restrictions imposed on imported grains that shielded landowners from competition and stifled free trade.Later, Norman Angell was awarded the Nobel Peace Prize for writing that world leaders were under “A Great Illusion” that armed conflict and conquest would bring greater wealth. During the Cold War, it was an element of the rationale for détente with the Soviet Union — to, as Henry Kissinger said, “create links that will provide incentive for moderation.”German Chancellor Olaf Scholz in Moscow last month. Since the fall of the Soviet Union, policies by Germany and other European countries have been partly shaped by the idea that economic ties with Russia could deflect conflict.Pool photo by Maxim ShemetovSince the disintegration of the Soviet Union three decades ago, the idea that economic ties can help prevent conflict has partly guided the policies toward Russia by Germany, Italy and several other European nations.Today, Russia is the world’s largest exporter of oil and wheat. The European Union was its biggest trading partner, receiving 40 percent of its natural gas, 25 percent of its oil and a hefty portion of its coal from Russia. Russia also supplies other countries with raw materials like palladium, titanium, neon and aluminum that are used in everything from semiconductors to car manufacturing.Just last summer, Russian, British, French and German gas companies completed a decade-long, $11 billion project to build a direct pipeline, Nord Stream 2, that was awaiting approval from a German regulator. But Germany halted certification of the pipeline after Russia recognized two separatist regions in Ukraine.From the start, part of Germany’s argument for the pipeline — the second to connect Russia and Germany — was that it would more closely align Russia’s interests with Europe’s. Germany also built its climate policy around Russian oil and gas, assuming it would provide energy as Germany developed more renewable sources and closed its nuclear power plants.Benefits ran both ways. Globalization rescued Russia from a financial meltdown and staggering inflation in 1998 — and ultimately smoothed the way for the rise to power of Vladimir V. Putin, Russia’s president. Money earned from energy exports accounted for a quarter of Russia’s gross domestic product last year.The Nord Stream 2 plant in Germany. The pipeline had been seen as a way to align Russia’s interests with those of Germany. Now it has been shelved.Michael Sohn/Associated PressCritics of Nord Stream 2, particularly in the United States and Eastern Europe, warned that increasing reliance on Russian energy would give it too much leverage, a point that President Ronald Reagan made 40 years earlier to block a previous pipeline. Europeans were still under an illusion, the argument went, only this time it was that economic ties would prevent baldfaced aggression.Still, more recently, those economic ties contributed to skepticism that Russia would launch an all-out attack on Ukraine in defiance of its major trading partners.In the weeks leading up to the invasion, many European leaders demurred from joining what they viewed as the United States’ overhyped warnings. One by one, French President Emmanuel Macron, German Chancellor Olaf Scholz and Italian Prime Minister Mario Draghi talked or met with Mr. Putin, hopeful that a diplomatic settlement would prevail.There are good reasons for the European Union to believe that economic ties would bind potential combatants more closely together, said Richard Haass, president of the Council on Foreign Relations. The proof was the European Union itself. The organization’s roots go back to the creation after World War II of the European Coal and Steel Community, a pact among six nations meant to avert conflict by pooling control of these two essential commodities.“The idea was that if you knit together the French and German economies, they wouldn’t be able to go to war,” Mr. Haass said. The aim was to prevent World War III.Scholars have attempted to prove that the theory worked in the real world — studying tens of thousands of trade relations and military conflicts over several decades — and have come to different conclusions.The Russia-Ukraine War and the Global EconomyCard 1 of 6Rising concerns. More

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    US Escalates Sanctions With a Freeze on Russian Central Bank Assets

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    WASHINGTON — The Treasury Department on Monday moved to further cut off Russia from the global economy, announcing that it would immobilize Russian central bank assets that are held in the United States and impose sanctions on the Russian Direct Investment Fund, a sovereign wealth fund that is run by a close ally of President Vladimir V. Putin.The moves are meant to curb Russia’s ability to use its war chest of international reserves to blunt the impact of sanctions that the United States and European allies have enacted in response to Russia’s invasion of Ukraine.“The unprecedented action we are taking today will significantly limit Russia’s ability to use assets to finance its destabilizing activities, and target the funds Putin and his inner circle depend on to enable his invasion of Ukraine,” Treasury Secretary Janet L. Yellen said in a statement.Russia has spent the last several years bolstering its defenses against sanctions, amassing $643 billion in foreign currency reserves in part by diverting its oil and gas revenues and reducing its holdings of U.S. dollars. New restrictions by the United States and its allies against selling rubles to Russia aim to undercut the country’s ability to support its currency in the face of new sanctions on its financial sector.As a result of the sanctions, Americans are barred from taking part in any transactions involving the Russian central bank, Russia’s National Wealth Fund or the Russian Ministry of Finance.Any Russian central bank assets that are held in U.S. financial institutions are now stuck, and financial institutions outside the United States that hold dollars for the bank cannot move them. Because the United States has acted in coordination with European allies, Russia’s ability to use its international reserves to support its currency has been curbed. Japan joined with Western allies in imposing the central bank sanctions, freezing Russia’s yen-denominated foreign reserves, the news agency Nikkei reported.“This is simply unprecedented to a scale and scope that we haven’t seen since the Cold War,” said John E. Smith, the former director of the Treasury Department’s Office of Foreign Assets Control. “Sanctions against the Central Bank of Russia and the central bank’s assets held worldwide are simply beyond comparison to previous sanctions regimes, particularly involving a major power like Russia.”It is not clear how much of Russia’s currency reserves are held in U.S. dollars, and Biden administration officials declined to provide an estimate in a briefing with reporters on Monday.The sanctions on the Russian Direct Investment Fund represent an expansion of the effort to sever Russian financial ties from the rest of the world and punish Russian elites. The Treasury Department described the fund, which was created in 2011 and operates in the insurance and financial services industries, as Mr. Putin’s “slush fund” and emblematic of Russia’s kleptocracy. The chief executive of the fund is Kirill Dmitriev, a close ally of Mr. Putin.The fund, according to its website, works with the “world’s foremost investors” to make direct investments in leading and promising Russian companies. It has reserved capital of $10 billion under management and has attracted over $40 billion into the Russian economy. The sanctions ban any Americans from investing in the fund and freeze any assets that it holds in the United States.Senior Biden administration officials said the actions were effective immediately. They noted that the value of Russia’s ruble had already fallen more than 30 percent over the weekend and that Russia’s central bank more than doubled its interest rate to try to mitigate the fallout. They also predicted that inflation would soon spike and economic activity would contract as the country’s currency lost value.Even nations that usually remain neutral in global disputes entered the fray.Switzerland, a favorite destination for Russian oligarchs and their money, announced on Monday that it would freeze Russian financial assets in the country, setting aside its tradition of neutrality to join the European Union and a growing number of nations seeking to penalize Russia for the invasion of Ukraine. The country said it would immediately freeze the assets of Mr. Putin, Prime Minister Mikhail V. Mishustin and Foreign Minister Sergey V. Lavrov, as well as all 367 individuals the European Union imposed sanctions on last week.“These are probably the most serious economic sanctions ever imposed on a country,” said Elina Ribakova, the deputy chief economist of the Institute of International Finance, predicting that Russia’s economy could contract by double digits.The U.S. moves represent a significant escalation of sanctions, although the Treasury Department said it was making an exemption to ensure that transactions related to Russia’s energy exports could continue. It is issuing a “general license” to authorize certain energy-related transactions with the Russian central bank.The carve-out means that energy payments will continue to flow, mitigating risks to global energy markets and Europe, which is heavily reliant on Russian oil and gas exports. U.S. officials said that they wanted energy prices to remain steady and that they did not want a spike in prices to benefit Mr. Putin. However, they noted that they were considering measures that would restrict Russia from acquiring technology it needs to be an energy production leader in the long term.“The U.S. and other Western economies have deployed a set of highly potent financial weapons against Russia with remarkable speed,” said Eswar Prasad, a Cornell University economics professor and a former International Monetary Fund official. “Cutting off access to global financial markets and to a country’s war chest of international reserves held in currencies of Western economies amounts to a crippling financial blow, especially to an economy like Russia’s that relies to such a large extent on export revenues.”The measures announced on Monday were born from lessons the United States has learned since imposing sanctions on Russia after its annexation of Crimea in 2014. A senior Biden administration official said that Mr. Putin began amassing international reserves after 2014 to blunt the impact of future sanctions and that the United States, in preparing to exert new pressure on Russia’s economy, determined during months of preparation with European allies that it would need to target Russia’s central bank directly.Understand Russia’s Attack on UkraineCard 1 of 7What is at the root of this invasion? More

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    U.S. escalates sanctions with a freeze on Russian central bank assets.

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    The Treasury Department on Monday moved to further cut off Russia from the global economy, announcing that it would immobilize Russian Central Bank assets that are held in the United States and impose sanctions on the Russian Direct Investment Fund, a sovereign wealth fund that is run by a close ally of President Vladimir V. Putin.The moves are meant to curb Russia’s ability to use its war chest of international reserves to blunt the impact of sanctions that the United States and European allies have enacted in response to Russia’s invasion of Ukraine.“The unprecedented action we are taking today will significantly limit Russia’s ability to use assets to finance its destabilizing activities, and target the funds Putin and his inner circle depend on to enable his invasion of Ukraine,” Treasury Secretary Janet L. Yellen said in a statement.As a result of the sanctions, Americans are barred from taking part in any transactions involving the Russian Central Bank, Russia’s National Wealth Fund or the Russian Ministry of Finance.The moves represent a significant escalation of U.S. sanctions, although the Treasury Department said it was making an exemption to ensure that transactions related to Russia’s energy exports can continue. It is issuing a “general license” to authorize certain energy-related transactions with the Russian Central Bank.On Saturday, the European Commission, Britain, Canada, France, Germany, Italy and the United States said they would remove some Russian banks from the SWIFT financial messaging system, essentially barring them from international transactions, and impose new restrictions on Russia’s Central Bank to prevent it from using its large international reserves to sidestep sanctions.Russia has spent the last several years bolstering its defenses against sanctions, amassing $643 billion in foreign currency reserves in part by diverting its oil and gas revenues. New restrictions by the United States and its allies against selling rubles to Russia aim to undercut the country’s ability to support its currency in the face of new sanctions on its financial sector. More

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    Before Ukraine Invasion, Russia and China Cemented Economic Ties

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    Facing a wary United States and worried about depending on imports by sea, China is buying more energy and food from its northern neighbor.BEIJING — As Russia wreaks havoc in Ukraine, Moscow has a powerful economic ally to help it resist Western sanctions: China.Chinese purchases of oil from Russia in December surpassed its purchases from Saudi Arabia. Six days before the military campaign began, Russia announced a yearslong deal to sell 100 million tons of coal to China — a contract worth more than $20 billion. And hours before Russia began bombing Ukraine, China agreed to buy Russian wheat despite concerns about plant diseases.In a throwback to the 1950s, when Mao Zedong worked closely with Joseph Stalin and then Nikita Khrushchev, China is again drawing close to Russia. As the United States and the European Union have become wary of China, Beijing’s leaders have decided that their best geopolitical prospects lie in marrying their vast industrial might with Russia’s formidable natural resources.Recent food and energy deals are just the latest signals of China’s economic alignment with Russia.“What happened up to now is only a beginning for both the Russian expansionism by force and the Chinese economic and financial support to Russia,” Shi Yinhong, a professor of international relations at Renmin University in Beijing, said in a text message. “This does not mean that China directly supports in any degree that expansionism — this only means that Beijing strongly feels the necessity to maintain and boost strategic partnership with Moscow.”The United States and the European Union are hoping that sanctions force Russia to reconsider its policies. But Wang Wenbin, the Chinese foreign ministry’s spokesman, said at a briefing on Friday that China opposed the use of sanctions.“Sanctions are never an effective way to solve the problems,” he said. “I hope relevant parties will still try to solve the problem through dialogue and consultation.”At the same time, Russia’s invasion of Ukraine has imposed an awkward diplomatic quandary on China by violating the principle of national sovereignty that the Chinese leaders regard as sacrosanct. While President Xi Jinping of China has not criticized Russia publicly, he could use his country’s economic relationship with its northern neighbor as leverage to persuade the Russians to resolve the crisis quickly.Mr. Xi and President Vladimir V. Putin of Russia spoke by phone on Friday. An official Chinese statement said afterward that Mr. Xi had expressed support for Russia in negotiating an agreement with Ukraine — a stance that Mr. Putin has also favored, provided that Ukraine accepts his terms.Until now, much of China’s energy and food imports came across seas patrolled by the U.S. or Indian navies. As China’s leaders have focused lately on the possibility of conflict, with military spending last year growing four times as fast as other government spending, they have emphasized greater reliance on Russia for crucial supplies.China and Russia share a nearly 2,700-mile border, and in recent years China has become Russia’s largest source of imports and the biggest destination for its exports.“Given the geopolitical tensions, Russia is a very natural geopolitical partner,” said Andy Mok, a senior research fellow at the Center for China and Globalization in Beijing.Initial Western sanctions on Russia have focused on limiting technology exports and imposing financial penalties. For now, U.S. officials have avoided targeting consumer goods, agricultural products and energy, to try to avoid harming ordinary people and further fueling inflation.China is the world’s dominant manufacturer of electronics, machinery and other manufactured goods, and has been supplying them to Russia in exchange for food and energy.A train carrying coal in Yekaterinburg, Russia, in 2020. China’s imports of Russian coal have more than doubled in the past three years.Maxim Babenko for The New York TimesThe new cornerstone of relations between China and Russia is the Sino-Russian nonaggression pact concluded in Beijing on Feb. 4. Mr. Xi and Mr. Putin reached the deal hours before the opening ceremony of the Beijing Winter Olympics and issued a statement saying the countries’ friendship “has no bounds.”The pact freed Mr. Putin to move troops and military equipment from Russia’s border with China to its border with Ukraine while ushering in closer economic cooperation.“The joint statement is strong and has lasting consequences for the new world order,” said Jean-Pierre Cabestan, a research professor of political science at Hong Kong Baptist University.The Chinese and Russian governments share many values, particularly their antipathy to sanctions the West imposes on human-rights grounds. “The two sides firmly believe that defending democracy and human rights should not be used as a tool to exert pressure on other countries,” their pact on Feb. 4 said.When the Obama administration imposed sanctions on Russia after its invasion of Ukraine’s Crimea region in 2014, China helped Russia evade them.It is not clear if China will help Russia evade sanctions put in place this week. On Tuesday, the Biden administration added to previous measures by announcing sanctions against Russia’s two largest financial institutions and sweeping restrictions on advanced technologies that can be exported to Russia. The technological curbs, when taken in concert with allies, would block roughly a fifth of Russian imports, the administration said.Chinese companies that circumvent those rules could face escalating punishment by the United States, including criminal and civil penalties, said Martin Chorzempa, a senior fellow at the Peterson Institute for International Economics. Those businesses could also be cut off from American technology and the financial system.ZTE and Huawei, two Chinese firms that were barred from receiving American technological exports, attracted the attention of the U.S. government in part for evading sanctions on Iran.“The interesting question is: Is China going to comply with this?” Mr. Chorzempa said. China also has a law designed to penalize companies for following extraterritorial sanctions by countries like the United States, he said, all factors that “could put companies in a real bind.”“If they don’t comply with the U.S., they’re in trouble with the U.S., but if they don’t comply with China, they could also face penalties in China,” he said.Of course, collecting fines from companies that are unwilling to pay and monitoring whether businesses comply with the rules could be difficult, Mr. Chorzempa added. “It’s already proving difficult to monitor the things that are already controlled, and if you expand that list, that’s going to be a real challenge to verify what’s going to Russia,” he said.Russia’s Attack on Ukraine and the Global EconomyCard 1 of 6A rising concern. More

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    How the U.S. and Europe Are Targeting Putin With Sanctions

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    WASHINGTON — The United States and Europe moved on Friday to personally penalize President Vladimir V. Putin of Russia for his invasion of Ukraine, imposing sanctions aimed at freezing his wealth while continuing to try to cripple his military and economic capabilities through other new restrictions.White House officials said that President Biden intended to impose sanctions and freeze the assets of Mr. Putin, along with Sergey V. Lavrov, his foreign minister. Other Russian national security officials will also be subject to the sanctions, and the United States plans to impose a travel ban to restrict the movement of Russia’s top leaders.The decisions align the United States with its European allies, whose governments made similar moves earlier in the day.“Treasury is continuing to inflict costs on the Russian Federation and President Putin for their brutal and unprovoked assault on the people of Ukraine,” Treasury Secretary Janet L. Yellen said in a statement announcing the sanctions.European leaders met into the early hours of Friday to hammer out an agreement over a new set of sanctions aimed more broadly at the Russian economy and at Mr. Putin himself, as his troops advanced in their invasion of Ukraine.One of the decisions was to freeze the assets of Mr. Putin and Mr. Lavrov, but not to impose a travel ban on them, according to three European Union diplomats and officials familiar with the draft E.U. sanctions.The new American and European sanctions are a provocative step given how rarely governments, including the United States, take aim at foreign leaders. Yet they may prove largely symbolic given that the status of Mr. Putin’s financial holdings has been cloaked in mystery and his money is not believed to be held in the United States.Jen Psaki, the White House press secretary, said that imposing sanctions directly on Mr. Putin “sends a clear message about the strength of the opposition to the actions by President Putin and the direction in his leadership of the Russian military.”Speaking to reporters on Friday, Ms. Psaki said the decision had been made in the past 24 hours after consultation with European leaders. She would not comment on what impact she believed the sanctions would have on Mr. Putin. But she underscored that they were a demonstration of trans-Atlantic unity in opposition to his actions.While the United States has imposed sanctions on and frozen the assets of some Russian oligarchs, targeting Mr. Putin directly was a significant escalation. It puts him in similar company with Presidents Bashar al-Assad of Syria and Aleksandr G. Lukashenko of Belarus, both of whom have been subject to personal sanctions by the U.S. government.Adam M. Smith, a former Treasury Department official who is now a partner at the law firm Gibson, Dunn & Crutcher, said placing sanctions on Mr. Putin sent a significant message given that the United States had never taken a similar action against such a powerful leader. However, he said that it was unlikely that the sanctions would affect Mr. Putin’s wealth or change his calculus in Ukraine.“I don’t think Putin is really going to lose much sleep on being sanctioned,” Mr. Smith said.The personal sanctions add to the growing list of restrictions that the Biden administration, in coordination with Europe, has rolled out. The United States has placed sanctions on major Russian financial institutions and the nation’s sovereign debt, and on Thursday, it took steps to prevent Russia from gaining access to American technology critical for its military, aerospace industry and overall economy.But the attempt to punish Mr. Putin has exposed the degree to which many European countries rely on Russia for energy, grains and other products. A package of penalties, which European leaders described as unprecedented in terms of its size and reach, was difficult to forge consensus on, even as Russian forces approached Kyiv, Ukraine’s capital.Europe’s economies are deeply intertwined with Russia’s economy, and the more the European Union leans into Russian sanctions, the more its own members will also feel the pain. The toughest of sanctions could even derail the bloc’s tentative recovery from the recession induced by the coronavirus pandemic.That is why negotiators left off the table particularly difficult elements, such as imposing sanctions on oil and gas companies or banning Russia from SWIFT, the platform used to carry out global financial transactions on commodities including wheat. E.U. officials said one key reason for their reluctance to cut off Russia’s access to the platform was that Europe uses it to pay for the gas it buys from Russia.Experts said that the approved sanctions were tough and that the speed at which the European Union was moving was impressive. But some were critical of the leaders for not going further.President Volodymyr Zelensky of Ukraine was scathing in a statement posted on Facebook on Friday.“This morning, we are defending our state alone,” he said. “Like yesterday, the world’s most powerful forces are watching from afar. Did yesterday’s sanctions convince Russia? We hear in our sky and see on our earth this was not enough.”Understand Russia’s Attack on UkraineCard 1 of 7What is at the root of this invasion? More

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    Biden Hits Russia With Broad Sanctions for Putin’s War in Ukraine

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    The penalties will affect Russia’s biggest banks, its weapons industry, its largest energy company and families close to President Vladimir V. Putin. The country’s stock market has plummeted.WASHINGTON — President Biden, vowing to turn President Vladimir V. Putin of Russia into a “pariah,” announced tough new sanctions on Thursday aimed at cutting off Russia’s largest banks and some oligarchs from much of the global financial system and preventing the country from importing American technology critical to its defense, aerospace and maritime industries.The package unveiled by the U.S. government is expected to ripple across companies and households in Russia, where anxiety over Mr. Putin’s full-scale invasion of Ukraine has already begun setting in. The nation’s stock market fell more than 30 percent on Thursday, wiping out a huge amount of wealth.The new U.S. sanctions include harsh penalties against the two largest Russian financial institutions, which together account for more than half of the country’s banking assets.U.S. officials are also barring the export of important American technology to Russia, which could imperil industries there. In addition, the United States will limit the ability of 13 major Russian companies, including Gazprom, the state-owned energy conglomerate, to raise financing in Western capital markets. And it is penalizing families close to Mr. Putin.The sanctions against the financial giants will cause immediate disruptions to Russia’s economy but are manageable over the longer term, analysts said. The technology restrictions, on the other hand, could cripple the ability of certain Russian industries to keep up.“Putin chose this war, and now he and his country will bear the consequences,” Mr. Biden said in remarks from the East Room of the White House. “This is going to impose severe cost on the Russian economy, both immediately and over time.”It was the second round of American sanctions imposed on Russia this week, following a more modest tranche that Mr. Biden announced on Tuesday after Mr. Putin’s government recognized two Russia-backed insurgent enclaves in eastern Ukraine as independent states.It was accompanied by a blizzard of sanctions from other countries announced on Thursday. Britain adopted penalties largely in line with the American ones, with additions such as barring Aeroflot, the Russian airline, from operating in its territory. The European Union announced measures including bans on large bank deposits in the European Union and halts in many technological exports to Russia, including semiconductors. Japan and Australia also unveiled various sanctions.One question in the days and weeks ahead is whether the United States and its European allies can stay in lock step on Russia’s actions, as they claim they will. Secretary of State Antony J. Blinken spoke on both Wednesday and Thursday with the European Union’s top diplomat, Josep Borrell Fontelles, a sign of the intense efforts to coordinate a joint response.The new suite of sanctions from Washington includes some of the tougher penalties that U.S. officials had said were being considered. There had been debate about whether constricting the operations of Russia’s biggest banks and other large companies would cause too much pain to ordinary Russians and to citizens in other countries.Russia has a $1.5 trillion economy, the world’s 11th-largest. The global economy remains precarious at the start of the third year of the pandemic, and many governments are grappling with the highest inflation rates in decades. The price of crude oil has been surging this week because of Mr. Putin’s actions.“I know this is hard, and that Americans are already hurting,” Mr. Biden said on Thursday. “I will do everything in my power to limit the pain the American people are feeling at the gas pump. This is critical to me.”But he added that Mr. Putin’s aggression could not go unanswered. “If it did, the consequences for America would be much worse,” he said. “America stands up to bullies. We stand up for freedom. This is who we are.”Residents lined up at a bus station in Kyiv, Ukraine’s capital, on Thursday.Emile Ducke for The New York TimesDaleep Singh, the deputy national security adviser for international economics, told reporters that over time, the sanctions would “translate into higher inflation, higher interest rates, lower purchasing power, lower investment, lower productive capacity, lower growth and lower living standards in Russia.”But it is unclear whether the sanctions will compel Mr. Putin to halt his offensive, in which dozens of Ukrainian soldiers and civilians have already been killed, according to Ukrainian officials. If Mr. Putin pushes forward, then the sanctions will serve as a punishment, Mr. Blinken has said.Some analysts are skeptical that the pain of the sanctions will break through to Mr. Putin, who has isolated himself during the pandemic, even from some of his close advisers.Alexander Gabuev, a scholar at the Carnegie Moscow Center, said the Russian leader and the top officials around him had adopted a bunker mentality, understanding that their lives and wealth depend on their status at home, not within Western nations. They also see themselves as being on the frontline of an ideological contest with the United States and its allies, he said.Furthermore, the Russian government adopted fiscal policies to shield the country’s economy after the United States and Europe imposed sanctions in 2014 following Mr. Putin’s first invasion of Ukraine, and some top security officials and oligarchs have profited off the changes.Edward Fishman, who oversaw sanctions policy at the State Department after Russia annexed Crimea in 2014, said he was surprised at the breadth of the new U.S. sanctions beyond the financial and technology sectors. He said the measures limiting access to capital markets for Russian state-owned enterprises in industries as varied as mining, metals, telecommunications and transportation “cut across the commanding heights of the Russian economy.”Even as Russia’s stock market plunged and the ruble fell to a record low against the dollar, the country may avoid all-out financial panic. Sergey Aleksashenko, a former first deputy chairman of the Central Bank of Russia and former chairman of Merrill Lynch Russia, said the financial measures were likely to inflict serious but ultimately bearable pain.“They will be able to manage what is related to the financial sector,” Mr. Aleksashenko said. “Maybe it will be complicated, maybe it will be expensive — but it’s doable.”More damaging, albeit over a longer term, Mr. Aleksashenko said, would be the new technology export controls.The export controls imposed by the Commerce Department are aimed at severing the supply of advanced technologies to Russia, such as semiconductors, computers, lasers and telecommunications equipment.The measures are expected to stop direct technological exports from American companies to Russia, potentially hobbling the Russian defense, aerospace and shipping industries, among others. They also go beyond previous sanctions issued by the U.S. government by placing new export limits on products that are manufactured outside the United States but use American equipment or technology.The administration said the measures, taken in concert with allies, would restrict more than $50 billion of key inputs to Russia. The country imported $247 billion of products in 2019, according to the World Bank.“This is a massive set of technology controls,” said Emily Kilcrease, a senior fellow at the Center for a New American Security.Understand Russia’s Attack on UkraineCard 1 of 7What is at the root of this invasion? More