Britain will slap sanctions on Russia’s “shadow ships” in a bid to choke off cash for Vladimir Putin’s war effort.
The fleet of tankers, which have obscure or dubious ownership after Western countries imposed sanctions on Russia, popped up to evade sanctions and transport Russian oil to global buyers. The so-called shadow ships provide a vital stream of funds to the Kremlin to finance its invasion of Ukraine.
Tax on oil production collected by the Kremlin in 2023 amounted to 8.9 trillion roubles, or 31% of Russia’s total federal revenues, according to Downing Street.
The announcement came as Rishi Sunak met world leaders at the G7 summit in Puglia, Italy, in what could be his last foray on the world stage as Prime Minister. He will join US President Joe Biden, France’s Emmanuel Macron and Italy’s Giorgia Meloni among others in efforts to ramp up the pressure on Putin while unlocking billions of pounds for Kyiv.
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AFP via Getty Images)
A plan on the table would use the massive profits generated from $285billion in frozen Russian assets to back a $50billion loan to Ukraine. But there are disagreements on whether the EU or the US should be on the hook for loan.
Mr Sunak will also announce nearly £250million in funding for Kyiv to rebuild critical power infrastructure after a sustained Russian bombing campaign.
The UK unveiled 50 new sanctions to degrade Russia’s war machine, which also include institutions at the heart of Russia’s financial system and suppliers supporting military production.
These new sanctions also target suppliers of munitions, machine tools, microelectronics, and logistics to Russia’s military, including entities based in China, Israel, Kyrgyzstan and Türkiye, along with ships which transport military goods from North Korea to Russia.
The new package cracks down on institutions at the heart of Russia’s financial system, including the Moscow Stock Exchange. This action is taken in coordination with the US, which designated the Moscow Stock Exchange on 12 June.
Mr Sunak said: “The UK will always stand shoulder to shoulder with Ukraine in its fight for freedom. Today we are once more ramping up economic pressure through sanctions to bear down on Russia’s ability to fund its war machine. Putin must lose, and cutting off his ability to fund a prolonged conflict is absolutely vital.”