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U.S. hits Russian deputy minister and energy firms with sanctions

[January 27, 2018] By Jack Stubbs and Patricia Zengerle

MOSCOW/WASHINGTON (Reuters) - The United States added Russian officials and energy firms to a sanctions blacklist on Friday, days before details of further possible penalties against Moscow are due to be released.

Washington could release reports as early as Monday laying out the possibilities for expanded sanctions against Russia over its alleged meddling in the 2016 U.S. presidential election, an accusation the Kremlin has repeatedly denied.

Leading Democrats in the U.S. Congress wrote to Trump on Friday, demanding that the administration use Monday's deadline to retaliate for what they described as cyber attacks intended to influence other countries' elections.

A Treasury Department spokesperson said the department is "actively working" on reports required under the "Countering America's Adversaries Through Terrorism Act" and aimed to release them consistent with timelines in the legislation.

Russia is already under U.S. sanctions over its annexation of Crimea from Ukraine in 2014 and support for separatist rebels fighting in eastern Ukraine.

On Friday, Treasury said it had added 21 people and nine companies to the sanctions list, including some that were involved in the delivery of Siemens <SIEGn.DE> gas turbines to Crimea.

It said Friday's announcement was not related to the reports due on Monday.

"This action underscores the U.S. government’s opposition to Russia’s occupation of Crimea and firm refusal to recognize its attempted annexation of the peninsula," the department said in a statement.

MANY TENSIONS

The Ukraine-related sanctions represent one of many areas of tension between the United States and Russia, including over how to end the Syrian civil war and whether to hold to the 2015 Iran nuclear deal, despite U.S. President Donald Trump's campaign emphasis on improving ties with Moscow.

One person added to the list was Russian Deputy Energy Minister Andrey Cherezov, who was put under sanctions by the European Union over his role in the delivery of turbines to Crimea last year.

Also added was Sergey Topor-Gilka, head of the Russian engineering company Technopromexport, as well as multiple subsidiaries of oil producer Surgutneftegaz <SNGS.MM>.

A spokeswoman for Rostec, which is already subject to U.S. sanctions and is the parent company of Technopromexport, said the company regretted that the main U.S. main tool in international relations was pressure and not dialogue.

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President Donald Trump walks down stairs after a round of meetings during the World Economic Forum annual meeting in Davos, Switzerland, January 25, 2018. REUTERS/Denis Balibouse/File Photo

The Russian Energy Ministry declined immediate comment.

Daniel Fried, a former U.S. State Department expert, said he viewed Friday's announcement as "sanctions maintenance" - essentially targeting individuals and entities that have taken the place of others who have earlier been sanctioned.

"To make sure a sanctions regime is effective, you need to update it periodically. You don’t simply target people and let it sit, because other people fill in and do the same bad deeds that you targeted the first ones for," Fried said.

RIA news agency quoted Vladimir Dzhabarov, deputy chairman of the international affairs committee of Russia's upper house of parliament, as saying: "This is not a policy of sanctions, it is a policy of containing a growing Russia as much as possible. The Americans declared war on us. We draw conclusions from this and move on."

Separately, the United States could release reports as early as Monday outlining the scope for expanding sanctions against Russia, including a list of prominent oligarchs and potential restrictions on the holding of Russian government debt.

The sanctions law Trump signed on Aug. 2 requires Treasury to prepare a list of the most significant Russian oligarchs "as determined by their closeness to the Russian regime and their net worth."

This will be accompanied by a report "describing in detail the potential effects of expanding sanctions ... to include sovereign debt and the full range of derivative products."

Both reports are due to be sent to Congress by the end of January, weeks before Russia is due to vote in a presidential election that President Vladimir Putin is widely expected to win.

(Reporting by Jack Stubbs and Gleb Stolyarov in Moscow and Patricia Zengerle in Washington; Writing by Jack Stubbs and Arshad Mohammed; Editing by Kevin Liffey and James Dalgleish)

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