| WASHINGTON, March 21
WASHINGTON, March 21 U.S. sanctions this week
against Russia were carefully crafted in an attempt to target
President Vladimir Putin's inner circle without provoking a
backlash from Moscow against U.S. businesses, senior U.S.
Concerns about possible Russian retaliation "helped shape
the discussions about appropriate sanctions" within the White
House, said a senior U.S. official, speaking on condition of
anonymity. "There's an awareness that even targeted sanctions
can have broad effects."
Obama on Thursday announced assets freezes and bans on U.S.
business dealings against 20 Russians and a Russian bank, in
response to Putin's annexation of the Crimea from Ukraine.
The measures, notably tougher than those Obama unveiled just
three days earlier, have helped spark steep losses for Russian
stocks, and Russia's Finance Ministry said it may be forced to
cancel plans to borrow abroad this year.
Whether the sanctions will dissuade Putin from further
incursions into Ukraine, much less reverse Russia's annexation
of Crimea or force him to the negotiating table, is unclear.
Moreover, the careful balance of punishing Russia while
shielding U.S. businesses and the global economy will be harder
if Obama's administration decides another round of measures is
TARGETING PUTIN'S CIRCLE
Moscow brushed off a first set of U.S. sanctions, asset
freezes and travel bans against seven Russian officials and four
Ukrainians. The Thursday action targeted 16 Russian officials,
four wealthy individuals linked to Putin and Bank Rossiya, which
the U.S. Treasury said was Russia's 17th largest.
Bank Rossiya was targeted to put Putin on notice Russia's
financial sector was not immune, officials said.
Other than the bank, which the Treasury Department said also
was used by senior Russian officials and whose shareholders
included members of Putin's inner circle, all of the U.S.
sanctions have targeted individuals rather than companies.
Since Putin's rule in Russia is highly personal, the aim is
to put pressure on the coterie of people closest to him in terms
of money and power, officials said.
To make an impact, "you've got to go in that political
system to people around the president," the senior official
A Treasury Department spokesperson did not rule out further
sanctions against entities, but said, "When sanctioning
individuals, our focus remains on identifying their personal
assets, not any businesses that they operate."
NEXT STEP WOULD BE DIFFICULT
U.S. officials believe any further rounds of sanctions will
need to be even more carefully targeted to avoid a ban on an
entire sector of the Russian economy, like oil or metals, that
could reverberate through the global economy. Europe, for
instance, remains dependent on Russian natural gas.
In an executive order on Thursday, Obama opened the door to
targeting entities in specific sectors of the Russian economy,
such as energy and gas, mining, and financial services. He has
not yet used that tool.
Absent from the Thursday list were major Russian state-owned
enterprises such as energy giants Gazprom and Rosneft
, or the state-run arms export firm Rosoboronexport.
U.S. officials said Russian troops streaming into eastern
and southern Ukraine, which have pro-Russian populations, might
trigger additional sanctions. So might attempts by Moscow to
undermine the Ukrainian government in Kiev or crack down on
civilians, especially minorities, they said.
Fiona Hill of the Brookings Institution think tank in
Washington, believes that broad, tough sanctions would be the
only way to get Putin's attention.
"To really have any kind of impact, the sanctions have to be
akin to the kinds of sanctions we've applied against Iran, they
have to be all-encompassing and they have to get right to the
heart of the economy," she said.
Russia is counting on the U.S. holding fire, said Hill, a
former U.S. National Intelligence officer for Russia and
"I think there's been a calculation on the Russian side that
we wouldn't go too far, because it puts a pall on the business
environment," she added.
Some U.S. officials are more optimistic and believe there is
some evidence Putin wants a truce and is signaling he will not
retaliate for the latest U.S. moves. But whether that is a
temporary pause in the crisis is unclear.
(Editing by Alistair Bell and Peter Henderson)