The Rationale For Sanctioning Russia

Kimberly Marten explains it:

Sanctions would probably not do much to hurt direct Russian economic interests, given the dependence of many E.U. countries on Russian gas imports and the absence of any key economic levers in Europe or North America. Yet the sanctions threat could still have a negative impact on Russian President Vladimir Putin in an indirect way, by contributing to instability among the elite clans who vie for control over Kremlin policy.

Western pundits have a tendency to equate “Putin” with “Russia,” seeing their interests as one and the same.  But Putin does not rule alone.  Instead he sits at the top of competing informal network groups who vie against each other for political power, in a Kremlin game that Philip Hanson has likened (in an edited scholarly volume) to “dogfights under a carpet.” Putin’s political longevity is testament to his skill in balancing and managing this network competition, as Henry Hale recently argued.  Putin built his reputation on maintaining political and economic stability in Russia, replacing the chaos of the immediate post-Soviet years with order and predictability—and that means containing the dogfights.  If elite battles break out into the open it will be a sign of Putin’s weakness, and will likely lead contenders to emerge to challenge him.

Rosie Gray notes the EU’s reluctance to pursue sanctions:

“The basic issue is that it’s easy to talk about economic sanctions when you don’t really have an economic relationship with Russia, like the U.S.,” said Alex Kliment, director of emerging markets strategy for the Eurasia Group. “They [the EU] have a huge economic relationship with Russia and could inflict significant economic pain on Russia through sanctions.”

“But they also, by virtue of that economic relationship with Russia, are much more vulnerable,” Kliment said. Kliment said Germany, with its dependence on Russia’s vast oil reserves, would be a deciding factor.

Danny Vinik expects Germany to continue to resist sanctions:

Merkel is worried that Putin will cut off exports to the European Union. If that were to happen, it would cut off a huge energy source for Germany, and the rest of Europe, and cause gas prices to skyrocket. The United States would not be immune from higher gas prices, but European nations, particularly those like Germany that are highly reliant upon Russia’s energy exports, could also face shortages that upend their markets. Germany is looking to avoid that at all costs.

Keith Johnson predicts Putin won’t use Russia’s gas exports as a weapon:

Russia would almost certainly lose more in an energy war with Europe than it would gain. Fundamentally, energy trade between Russia and Europe is a two-way street. As much as European policymakers fret about dependence on Russian gas, Gazprom frets about dependence on the European market, which accounts for fully three-quarters of its export sales. More broadly, Moscow relies on oil and gas exports for one half of its federal budget. That makes a prolonged shut off of gas exports to Ukraine and the rest of Europe a dangerous proposition for Russian President Vladimir Putin.