Gas-guzzling Europe pressed to toughen Russian sanctions
The European Union is preparing new economic sanctions against Russia's most senior spies and security officials as it seeks to step up its response to the conflict in Ukraine.
Alexander Bortnikov, director of the Federal Security Service which replaced the Soviet-era KGB, and Mikhail Fradkov, the head of the Foreign Intelligence Service, are on the provisional list, according to a draft document obtained by Bloomberg News.
With the US pushing Europe to toughen its stance toward Russia a week after a Malaysian passenger jet was shot down over rebel-held territory in Ukraine, the EU moved to expand sanctions and to penalise some officials who served alongside President Vladimir Putin in the Cold War.
US President Barack Obama and Netherlands Prime Minister Mark Rutte "agreed that all evidence indicates Russia is still arming and supplying separatists" who continue battling Ukrainian armed forces, the White House said in a statement.
The two leaders also agreed that as a result, "the international community will need to enact additional sanctions," the statement said.
The US and Canada, as part of a toughening stance, will oppose World Bank projects in Russia, adding economic pressure on the country over its actions in Ukraine.
The US will vote against Russia-related loans and investments that come before the board, treasury department spokeswoman Holly Shulman said. A spokeswoman for Canadian finance minister, Joe Oliver, said her country also opposes such projects.
European governments are discussing doing the same, a European official said.
Planned EU sanctions haven't been as far-reaching as some investors had expected, reflected in the resiliance of the local Micex Index of Russian shares.
An updated list of those subject to sanctions is due to be published in the EU's official journal after national governments including Ireland agreed to add further people and entities. In its statement, the EU didn't disclose any names or the number of new people and entities targeted.
The EU measures would touch close KGB associates of Mr Putin, a former colonel in the intelligence service who served in East Germany. Like 61-year-old Mr Putin, Bortnikov (62) joined the KGB in 1975.
The list also includes the head of the security council, Nikolai Patrushev, and Kremlin-backed Chechen leader Ramzan Kadyrov.
The new list of 15 individuals and 18 entities is separate from proposals circulated earlier in the week by the European Commission to put further pressure on Mr Putin's government.
The new EU blacklist covers nine separatist organisations and militias in eastern Ukraine and nine state-owned Crimean companies that were seized by Russia after it annexed the Black Sea peninsula in March.
Under plans discussed in Brussels, the EU is also considering a ban on European purchases of bonds or shares sold by Russia's state-owned banks among the options for stepped-up sanctions on the Kremlin, according to a proposal presented to member states.
Previously, the EU had blacklisted 72 people and two state-owned Crimean companies. People on the list face asset freezes and travel bans; companies and organisations face asset freezes, barring them from doing business in the EU.