(Recasts; adds details, background throughout)
By Steve Holland and Jeff Mason
March 20 President Barack Obama on Thursday
imposed sanctions on 20 Russian citizens as well as a bank
linked to Moscow's move to annex Ukraine's Crimea peninsula and
threatened broader penalties against key sectors of Russia's
economy if Moscow moves further into Ukraine.
Among the 20, Obama targeted several individuals close to
Russian President Vladimir Putin in retaliation for his military
seizure of Ukraine's Crimea region. Any assets they have in the
United States will be frozen and they will also be barred from
Russia's Bank Rossiya, with $10 billion in assets, was
singled out for U.S. sanctions. A Treasury Department statement
said it is the personal bank for senior officials of the Russian
government, including Putin's inner circle.
St. Petersburg-based Bank Rossiya is chaired and
partly-owned by Yuri Kovalchuk, a close adviser to Putin.
Kovalchuk, whose association with Putin dates back to the early
1990s, was among the 20 individuals targeted for sanctions.
The bank will be "frozen out of the dollar," a senior Obama
administration official said.
Gennady Timchenko, one of the founders of Gunvor, which is
one of the world's largest independent commodity trading
companies involved in the oil and energy markets, was also
singled out for penalties.
In a potentially ominous move, Obama said he had signed a
new executive order that clears the way for U.S. sanctions
against broad sections of the Russian economy should Putin's
military make moves beyond Crimea and into southern and eastern
Senior administration officials said many parts of the
Russian economy could be targeted, including the financial
services sector and the key energy, defense and mining sectors.
Russia's oil and gas industry alone accounts for nearly half
of the country's annual budget revenues.
Obama, speaking at the White House, said Russia's threats to
southern and eastern Ukraine posed a serious risk of escalation
of the crisis in the region.
"This is not our preferred outcome. These sanctions would
not only have a significant impact on the Russian economy, but
could also be disruptive to the global economy. However, Russia
must know that further escalation will only isolate it further
from the international community," Obama said.
One official said Washington was using the new authority to
prepare additional sanctions that would sting Moscow while
having the smallest impact possible on the United States and its
"Sanctions build over time. They are very powerful. And
people may think that they are a mere wrist slap. I can assure
them that they are not," the official said.
Obama also said the United States is reacting to the
"dangerous risks of escalation, including threats" to Ukraine.
"These are all choices that the Russian government has made,
choices that have been rejected by the international community
as well as the government of Ukraine. And because of these
choices the United States is today moving, as we said we would,
to impose additional costs on Russia," he said.
He also promised unwavering U.S. support to NATO allies,
which include Russian neighbors Lithuania, Latvia and Estonia.
(Reporting by Steve Holland and Jeff Mason,; additional
reporting by Susan Heavey, Lesley Wroughton, Doina Chiacu and
David Storey; editing by G Crosse)