By Doina Chiacu, Warren Strobel and Arshad Mohammed
WASHINGTON, April 13 The United States prepared
to step up sanctions against Moscow if pro-Russian military
actions in eastern Ukraine continue, a senior U.S. envoy said on
Sunday, but it is unclear whether new measures will win European
support or slow the Russian-backed separatist revolt.
The next round of U.S. sanctions, which would be the fourth
imposed since the Ukraine crisis began, is likely to target
Russians close to Putin as well as Russian entities, three
sources familiar with the discussions said on Sunday.
However, they will not necessarily target entire Russian
business sectors such as mining, banking and energy, the sources
said, adding that the situation was fluid.
"Broad sectoral sanctions are probably not up for immediate
action. What is up for immediate action is ... (Russian)
individuals and entities," said one of the sources. "All of this
is subject to what is happening on the ground."
Even if the United States were to target swathes of Russian
industry, U.S. officials said it was uncertain whether Europe
would go along with penalties that would affect Russia's economy
and powerful energy sector.
The sanctions have been the most visible sign of U.S. anger
at Russia's annexation of the Crimea region in southern Ukraine
last month, reflecting the deepest plunge in U.S.-Russian
relations since the Cold War.
Pro-Russian activists seized government buildings on
Saturday in the eastern town of Slaviansk, about 150 km (90
miles) from the Russian border. Ukrainian security forces were
trying to oust the activists, who set up barricades on the
outskirts of the city.
The American ambassador to the U.N., Samantha Power, said on
ABC's "This Week" that the latest events in Ukraine bore "the
telltale signs of Moscow's involvement."
"The president has made clear that, depending on Russian
behavior, sectoral sanctions in energy, banking, mining could be
on the table, and there's a lot in between," Power said.
"I think we've seen that the sanctions can bite, and if
actions like the kind we've seen over the last few days
continue, you're going to see a ramping up of those sanctions."
Power said sanctions already imposed by Washington have had
an impact: the Russian rouble has fallen to an all-time low, the
country's stock market has depreciated by 20 percent and
investors are fleeing the country.
But beyond declines in the rouble and Russian indexes, the
impact has been modest. Most of those hit by U.S. and EU
sanctions are not known to have extensive business interests.
One of those who does is billionaire oil and gas trader
Gennady Timchenko. He told Russian television on Saturday his
inclusion on the U.S. sanctions list had caused minor problems,
mainly because some European banks had become wary of carrying
out transactions with any entities linked to him.
But he said, for him personally, being on the list was
"quite an honor."
A new round of U.S. sanctions against Russia is likely to
target influential people or firms in its business sectors, such
as energy, engineering and financial services, as spelled out in
President Barack Obama's executive order last month.
The U.S. goal is to put more pressure on Russian President
Vladimir Putin's business allies. When sanctions were announced
in March, the U.S. Treasury said it would largely focus on
people and their personal assets, not businesses they operate.
But U.S. officials, speaking on condition of anonymity, said
there was no certainty European nations would be on board with
sanctions that would cause real pain and be felt not only in
Russia's economy but by U.S. and European interests too.
Broader sanctions could cause collateral damage to companies
that would be forced to sever ties with blacklisted firms and
could also affect Russian energy deliveries to western Europe.
It was also unclear whether Thursday's planned Geneva talks
involving the United States, Russia and Ukraine would happen
now, the U.S. officials said, as the Russians had begun setting
preconditions, including that Ukraine could not use force to
quell unrest in the east, and that all of Ukraine's regions,
including pro-Russian areas, be included in the discussion.
The three sources said the Obama administration had been
hesitant to impose the sectoral sanctions but that events over
the weekend in eastern Ukraine had clearly tilted the debate in
the direction of doing more, rather than less.
European Union foreign ministers are scheduled to meet on
Monday to discuss further Ukraine sanctions. One source said the
United States would likely hold off on deciding on further
sanctions until it sees where the EU consensus emerges.
The three sources familiar with the debate said there were
divergences within the European Union, with some advocating
sectoral sanctions, others for targeting more individuals and
entities, and others preferring to do nothing before Thursday's
meeting of U.S., Russian, EU and Ukrainian officials in Geneva.
"I don't think we'll see tier-three tomorrow, but it's very
difficult to envisage not seeing anything after the events of
the weekend," said another of the three sources, referring to
broad sectoral sanctions.
DESIGNS ON EASTERN UKRAINE?
Ukraine now faces a rash of rebellions in the east it says
are inspired and directed by the Kremlin.
Asked on ABC if Putin wants to seize eastern Ukraine, Power
said his actions "give credence to the idea."
Though Russians are insisting that is not what Moscow wants,
she said, "Everything they're doing suggests the opposite."
NATO described the appearance in eastern Ukraine of men with
specialized Russian weapons and identical uniforms without
insignia, as previously worn by Moscow's troops when they seized
Crimea, as a "grave development."
Power said the rebellion has "all the telltale signs of what
we saw in Crimea: It's professional, it's coordinated, there's
nothing grassroots-seeming about it. The forces are doing in
each of the six or seven cities that they've been active in
exactly the same thing."
However, the U.S. officials who spoke on condition of
anonymity said Russia's recent moves appeared to be less about
grabbing territory than about destabilizing what Russia sees as
an increasingly Western-centric government in Kiev.
The United States on Friday imposed sanctions on a
Crimea-based gas company, Chernomorneftegaz, effectively putting
it off limits to Russia's state-controlled Gazprom, which was
expected to bid for a stake in the company.
The move, along with penalties on six Crimean separatists
and a former Ukrainian official, is the third round of U.S.
sanctions since the Ukraine crisis erupted.
(Additional reporting by Sarah N. Lynch, Anna Yukhananov and
Christian Lowe; Writing by Doina Chiacu and Arshad Mohammed;
Editing by Jim Loney, Leslie Adler, Meredith Mazzilli and