Ukraine: West's Sanctions Against Russia Remain Relatively Porous - by Marcus Walker and Laurence Norman

The U.S. and Europe are stepping up their sanctions against Russia, but the restrictions remain partial and porous compared with other economic embargoes recently imposed by the West.

Bans on buying new bonds of Russian state-owned banks, or on selling some engineering technology to Russia's oil industry, are expected to hurt parts of Russia's economy. But the measures don't touch Russia's main business with the West: the sale of natural gas and oil to Europe. 

That makes the sanctions regime fundamentally different from the sweeping Western embargo that has blocked Iran from selling any oil or gas to its traditional customers in the European Union. 

"The EU's core business with Russia has been left untouched," said Stefan Lehne, a scholar at Carnegie Europe, a nonpartisan Brussels think tank. 

Mr. Lehne said the EU is likely to adopt further sanctions against Russia, including tighter financial-sector restrictions, but that energy supplies won't be touched. "If you really restrict Russian energy exports, then you hurt the EU as much as Russia." 

EU leaders including German Chancellor Angela Merkel have said the sanctions can be scaled back if Moscow becomes more cooperative in the Ukraine conflict—or scaled up if it continues to support pro-Russia rebels there. 

But few in Europe can imagine a boycott of Russian gas, which flowed West continuously even at the height of Cold War enmity. Many countries across the Continent have no way of replacing Russian gas quickly or affordably.

A sanctions regime that targets secondary economic ties such as banking, specialized engineering and weapons highlights the limits of the EU's room for maneuver. 

Despite doubts about the ability of the new measures to change the Kremlin's mind, experience shows international sanctions tend to escalate as the affected country finds ways to evade them. That leads to efforts to plug loopholes and tighten them. And in this particular conflict, political and military events are intensifying rather than defusing the underlying conflict. 

"The Ukrainian military is showing greater capability, so Russia has to step back or double down" in supporting the rebels, said Robert Kahn, senior fellow at the Council on Foreign Relations in Washington. "So far, the signs are it's likely to double down." 

Sanctions can be effective when accompanied by a workable political strategy to resolve a conflict through negotiations, but sometimes the EU adopts sanctions "out of a sense that something must be done," said Mr. Lehne at Carnegie Europe. 

"It's possible that this will be one of the effective cases, but it's not guaranteed," he said.

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