Even as sanctions are being imposed, the same countries doing the sanctioning are continuing to import a large proportion of their energy from Russia every day, which is in turn tying their hands in their ability to hit Moscow where it hurts most.
On Thursday, the European Union, U.K. and U.S. laid out sanctions that included measures to cut off Russia’s government and Russian banks from international financial markets but didn’t target oil and gas, which contribute around one-fifth of Russia’s gross domestic product. Last year, Russia sold around $100 billion worth of oil and gas to Europe, according to an estimate by William Jackson, chief emerging markets economist at Capital Economics.
The sanctions introduced by the West so far might reduce Russia’s GDP growth by 1 to 2 percentage points this year, the equivalent of $20 billion to $35 billion, Mr. Jackson said, cautioning that there is a large amount of uncertainty around that estimate.
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