US to impose sanctions on 150 entities for trading with Russia

The action marks an expanding effort to cut off the flow of goods Moscow needs for its war in Ukraine.

The Russian port of Vladivostok. Despite Western sanctions, Russia has been able to continue importing many products through countries including China, Turkey, Hungary and the United Arab Emirates. Picture: AFP

The US on Thursday sanctioned more than 150 foreign companies and individuals accused of aiding Russia, including by shipping American or other Western technology for Moscow, marking an expanding Western effort to cut off the flow of goods the Kremlin needs to prosecute its war against Ukraine.

The US and its allies over the past year have largely focused their finance-and-trade war against Russian firms. But as the Kremlin and its agents seek to sidestep Western sanctions and export controls by channeling the flow of prohibited goods through intermediary nations, officials say they are ramping up a campaign to target companies and individuals in countries acting as transit hubs for Russia.

Western allies representing more than half of the world’s economic power have severed much of Russia’s direct access to the global financial system and banned the export of technology that Russia’s military relies upon for modern warfare. Officials say their efforts to cut off the sale of goods such as computer chips, satellite parts and navigational equipment needed to target Ukrainian forces have hobbled Moscow’s war machine.

Treasury Secretary Janet Yellen said the punitive measures target Russia’s military supply chains, and warned that individuals and entities who profit from the invasion and their proximity to the Kremlin will be held accountable.

Russia has been able to continue importing many of those products by buying them through countries such as China, Turkey, Hungary and the United Arab Emirates. Western diplomats and security officials have in recent months jetted around the globe seeking to convince those governments to enforce their prohibitions, sharing intelligence on those aiding Moscow and helping grow their bureaucratic capacity to crack down on illicit activities. Elizabeth Rosenberg, the Treasury Department’s sanctions deputy, for example, is touring several countries in the Middle East this week as part of that mission.

To supplement those efforts and ward off others seeking to help Russia, the West is levying its own sanctions against entities in those nations. Thursday’s action by the Treasury and State departments, for example, includes sanctions against two Finnish companies and their respective French and Estonian corporate officials, according to one of the people familiar with the matter. U.S. officials say Siberica and Luminor shipped electronics to Russian firms that supply its military, including drone cameras, high-performance optical filters and lithium batteries.

The companies didn’t immediately respond to requests for comment. Luminor shipped more than a million dollars in goods to Russia between April and November, including computer chips and optical lenses from the U.S., the U.K. and Germany, according to Import Genius trade data viewed by The Wall Street Journal.

Turkish firms alleged to have made hundreds of shipments to Russian companies involved in manufacturing military drones and cruise missile systems were also among the scores of suppliers, financial institutions and industry officials targeted.

The State Department said that among those it sanctioned were companies involved in the country’s energy production and metals and mining sectors, industries critical to Russia in terms of revenue and manufacturing capacity.

The Biden administration is also adding scores of prosecutors, analysts and criminal investigators who safeguard against sanctions and export-control violations at the Justice Department and the Commerce Department’s Bureau of Industry and Security, which oversees export controls.

While Russia has successfully circumvented some Western sanctions to increase weapons production, it struggles to produce weapons at the pace required by the war and its weapons production is showing signs of deteriorating quality, according to a paper published Wednesday by the Institute for the Study of War, a Washington-based think tank.

The Wall Street Journal