New Sanctions against Russia – How they Reduce its Ability to Wage War

The European Union’s new sanctions against Russia, originally set for June 27, 2025, were designed to limit Moscow’s access to financial assets and technology. However, their approval has been delayed.

These sanctions aim to cut off Russia from critical financial and technological resources—an essential step toward ending the war in Ukraine.

Since Russia’s annexation of Crimea in 2014, and especially after its full-scale invasion of Ukraine in 2022, international sanctions have been a central tool to undermine its economic and military strength. They form a crucial part of the international strategy—particularly among Ukraine’s allies—to halt Russia’s aggression. Sanctions continue to exert significant pressure on the Russian economy, but internal divisions within the EU, including opposition from certain member states, still complicate the process of adopting new measures.

The 18th sanctions package, meant to deal a further blow to Russia’s economic and military infrastructure, was scheduled for adoption on June 27, 2025. However, Slovakia blocked the vote, forcing a postponement of the decision.

Read more about this in the article by Anton Kuchukhidze, political scientist and foreign policy analyst, expert at the “United Ukraine” Think Tank for The Gaze.

Firstly, political scientist argues that the European Commission’s latest sanctions package focuses on two of Russia’s most vital economic sectors: energy and banking. These new measures extend beyond Russia’s domestic economy and include restrictions on transactions linked to the Nord Stream project—a pipeline that once served as a powerful tool of energy coercion against Europe. The goal is to further isolate Russia internationally by cutting off its access to the financial and technological resources that fuel its military efforts.

Despite attempts to diversify its revenue streams, Russia’s economy still heavily depends on the energy sector. The sanctions limit its capacity to export oil and gas and restrict access to modern technology needed for energy extraction and processing.

In the banking sector, the sanctions make international transactions more difficult, hampering the ability of Russian businesses and the government to secure financing. These new restrictions add to the impact of previous measures, which are steadily draining Russia’s financial reserves.

Secondly, Kuchukhidze explains that since 2014—and especially following the full-scale invasion of Ukraine in 2022—sanctions imposed by the international community have been taking a heavy toll on the Russian economy. According to The Telegraph, signs of economic decline are becoming increasingly apparent, a view shared by both Western experts and Russia’s own institutions.

Russia’s Ministry of Economic Development and the Central Bank have issued warnings about a potential recession, citing key challenges such as rising inflation, a shrinking labor force, and a deepening credit crisis. Consumer prices are climbing rapidly due to limited access to imported goods, a weakened ruble, and persistent supply chain disruptions. These factors are eroding consumer purchasing power and driving up production costs.

The country is also experiencing a severe labor shortage, estimated at 2.6 million workers. This shortfall is largely the result of emigration, military mobilization, and war-related casualties—factors that have significantly reduced economic productivity. At the same time, Russian businesses are struggling with mounting debt, driven by restricted access to global financial markets and high domestic interest rates.

Finally, the expert summarizes that while the EU has made significant strides in advancing its sanctions policy, major challenges persist. The stance of countries like Slovakia highlights how the economic priorities of individual member states can hinder collective decision-making. To address this, the EU should consider introducing compensation mechanisms—such as subsidies to support the shift to alternative energy sources—for countries facing economic setbacks due to sanctions. Strengthening enforcement is also crucial, as sanctions continue to be circumvented through third-party nations like China, India, and Türkiye.

The economic consequences of earlier sanctions are already evident. According to the European Commission, Russia’s oil and gas revenues have dropped by 80%, inflation has surpassed 10%, and interest rates have hit 21%. Even President Putin has acknowledged the need to cut military spending, a clear sign that the sanctions are working. Russia’s growing economic fragility, confirmed by its own officials and analysts, presents a rare opportunity to bring the war to an end. Escalating pressure at this moment could prove pivotal in halting the aggression and restoring peace in Ukraine.

Read the full article by Anton Kuchukhidze on The Gaze: New Sanctions against Russia – How they Reduce its Ability to Wage War

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