U.S. announces first tranche of Russia sanctions as Biden says Ukraine ‘invasion’ is ‘beginning’

WASHINGTON/MOSCOW/DONETSK, UKRAINE – U.S. President Joe Biden on Tuesday announced the first wave of sanctions against Russia for what he said was the beginning of an invasion of Ukraine, and vowed steeper punishments ahead if Russia continues its aggression.

“We’re implementing sanctions on Russia’s sovereign debt. That means we’ve cut off Russia’s government from Western financing,” Biden said. The measures also would target financial institutions, and Russian “elites,” the U.S. president added.

In terms of his invasion plans, Russian President Vladimir Putin plans to go much further than he had previously indicated, Biden said.

“He’s setting up a rationale to take more territory by force,” Biden said in an address from the White House.

“I’m going to begin to impose sanctions in response, far beyond the steps we and our allies and partners implemented in 2014,” he added, in a reference to Russia’s annexation of Crimea from Ukraine.

He also said that the United States would continue to supply “defensive” weapons to Ukraine and deploy more U.S. troops to reinforce NATO allies in Eastern Europe.

Still, Biden said there was still time to avert the “worst case scenario” of a bloody full-scale Russian invasion through diplomacy.

“There’s no question that Russia is the aggressor, so we’re clear eyed about the challenges we’re facing,” Biden said.

“Nonetheless, there is still time to avert the worst case scenario that will bring untold suffering to millions of people if they move as suggested.”

Biden’s remarks came after NATO Secretary-General Jens Stoltenberg said on Tuesday that the alliance believed Russia was still planning a big assault on Ukraine following Moscow’s recognition of two separatist regions in the former Soviet republic’s east.

He spoke as the European Union also agreed on new sanctions that will blacklist more politicians, lawmakers and officials, ban EU investors from trading in Russian state bonds, and target imports and exports with separatist entities, the EU foreign policy chief said.

Germany, meanwhile, put the brakes on a new gas pipeline and Britain hit Russian banks with sanctions. The Russian Foreign Ministry criticized the new measures against Russia as “illegitimate.”

With Western concern about Russia’s intentions fueled by Moscow’s recognition of the two breakaway regions, NATO’s Stoltenberg said in Brussels: “Every indication is that Russia is continuing to plan for a full-scale attack of Ukraine.”

“We continue to call on Russia to step back … it’s never too late not to attack,” he told a news conference.

Russia’s parliament approved treaties with the two regions a day after Putin said he was recognizing their independence. Both adjoin Russia and have been controlled by Russian-backed fighters since 2014.

Putin said the territory covered the entire Donetsk and Luhansk regions of eastern Ukraine. He also signed a decree on deploying Russian forces there and on Tuesday Russia’s upper house of parliament formally granted his request to use troops abroad with immediate effect.

The prospect of a disruption to energy supplies and fears of war — stoked by reports of shelling in some areas and movements of unmarked tanks overnight in the rebel-controlled city of Donetsk — rattled international financial markets and sent oil prices surging to their highest level since 2014.

In Donetsk, some residents celebrated, with cars flying Russian flags and sounding their horns. But several blasts were heard in the city on Tuesday, and some people questioned whether Putin’s moves would bring peace.

Germany is Russia’s biggest customer for natural gas, and the decision by Chancellor Olaf Scholz to freeze the Nord Stream 2 pipeline — built but awaiting approval — was widely seen as one of the strongest measures Europe could take.

Scholz said he had asked his economy ministry to take steps to ensure that certification could not take place for now.

“This is a morally, politically and practically correct step in the current circumstances,” Ukrainian Foreign Minister Dmytro Kuleba tweeted. “True leadership means tough decisions in difficult times. Germany’s move proves just that.”

The Kremlin regretted Germany’s move and said it hoped the delay was temporary. Putin said Russia “aims to continue uninterrupted supplies” of energy to the world.

British Prime Minister Boris Johnson and French President Emmanuel Macron agreed on Tuesday to continue to work together to target those who supported what Johnson called Putin’s “aggressive approach.”

“Russia’s actions don’t just threaten Ukraine’s sovereignty, but are a blatant attack on freedom and democracy, the leaders agreed,” a joint statement said.

EU foreign policy chief Josep Borrell said Russia’s recognition of the two breakaway regions was an unacceptable breach of Ukraine’s sovereignty.

Meanwhile, a witness said they had seen a military convoy of more than 100 trucks with soldiers heading in the direction of the Ukrainian border in Russia’s Belgorod region.

Russian parliamentary approval of friendship treaties with the two breakaway regions could pave the way for Moscow to establish military bases there.

Ahead of the latest U.S. measures, Biden had signed an executive order to halt American business activity in them.

Britain announced sanctions on three Russian billionaires and five banks.

Germany convened a call of foreign ministers from the Group of Seven industrialized nations, in which they agreed to condemn Russia’s actions, according to Japan’s foreign minister.

The United States initially limited itself to measures directly related to the separatist regions, apparently preferring to keep a larger sanctions package against Russia itself in reserve.

Russia’s recognition of the separatist areas, and Putin’s authorization of what he described as peacekeeping troops there, still stops far short of the massed large-scale invasion that Western countries have said they fear Moscow is planning.

But it leaves Western leaders trying to guess Putin’s intentions for up to 190,000 troops deployed around Ukraine’s borders.

Western countries saw ominous signs in Putin’s rambling televised address on Monday, in which he characterized the Ukrainian leadership as illegitimate and the Ukrainian state as artificial.

Ukrainians consider such descriptions offensive and false. Kyiv is older than Moscow and, while parts of today’s Ukraine were captured by Russian czars, other parts were not ruled by Moscow until World War II.

Kristina Kvien, the top U.S. diplomat in Ukraine, said Putin’s “outrageous statements … were delusional, reflecting a warped vision reminiscent, not of a global leader, but of Europe’s worst authoritarians”.

President Volodymr Zelenskyy said Ukraine may sever diplomatic ties with Russia and urged allies not to wait for a further escalation to enact sanctions.

The West, which imposed sanctions on Russia after it annexed Crimea from Ukraine in 2014, appears likely to hold back on its toughest sanctions for now.

Russian Foreign Minister Sergey Lavrov brushed off the threat of sanctions.

“Our European, American, British colleagues will not stop and will not calm down until they have exhausted all their possibilities for the so-called punishment of Russia,” he said.

The Russian-backed separatists in Donetsk and Luhansk broke away from Ukrainian government control in 2014 and proclaimed themselves independent “people’s republics” after a pro-Moscow Ukrainian president was ousted in Kyiv.

“I know that the blood I spilled with my comrades and our labors and efforts and the losses of civilians were not in vain all this time,” Dmitry, a former member of a pro-Russian militia, said in Donetsk on Tuesday.