Sanctions: anaconda effect

By Vestnik Kavkaza

Yesterday the official exchange rate of the ruble reached its historic maximum – it exceeded 38 rubles to the US dollar. Washington stated that the weakening of the ruble against foreign currencies showed that the Western sanctions against Russia were working. However, Moscow says that, on the contrary, weakening of the ruble softens the influence of sanctions on the Russian economy. However, it is obvious that sanctions against Russia will bring a lot of problems.

A new packet of sanctions was presented by the EU on September 12. The EU forbade European companies from supplying Russian partners with services toward exploration and production of deepwater and Arctic oil and on shale oil projects. Earlier, the EU sanctions touched on supplying Russia with high-tech equipment in the oil sphere.

Konstantin Simonov, the Director General of the National Energy Security Foundation, says that “for a long time business was the main lawyer of Russia in the West. Western business tried to dispel myths about the resource nationalism of Russia, as our country was presented as an unfriendly territory to Western companies… However, conditions for foreign business were comfortable; despite the general stereotype about resource nationalism, foreign companies successfully improved in our market. Now they will suffer losses. But is it an argument for Western politicians today? The question is crucial, as it seems they don’t listen to rational arguments… They tried to make a bogeyman out of Russia, but I think it was not smart.”

According to Simonov, “the first spring the launched sanctions were rather soft. The gas sphere wasn’t touched. At the time, it seemed the U.S. was putting pressure on the EU. There were really funny things: for example, they forbade exports of deepwater oil-well drilling technology, even though it is well-known that Russia has no deepwater oil projects, we are not Brazil, the structure of our industry is absolutely different. At the moment everything is changing, and the last round of sanctions is absolutely illogical, as they punished us for the war in Ukraine, but when the ceasefire was agreed, they launched the strictest sanctions. There is no logic… I was optimistic in the summer, but now I realize that this is an anaconda effect – they will choke us. We should think about the next round and don’t expect that it will end in a year.”