EU Envoys Poised to Adopt 20th Package of Russia Sanctions, Diplomats Say

EU Diplomats to Adopt 20th Sanctions Package Against Russia Amid Pipeline Repair

EU Sanctions and Pipeline Developments

By Julia Payne

Background and Diplomatic Negotiations

BRUSSELS, April 22 (Reuters) - European Union envoys are set to adopt a 20th package of sanctions against Russia, with Slovakia and Hungary expected to drop their opposition to the move following the repair of the Druzhba oil pipeline, EU diplomats said on Wednesday.

The measures would deepen Europe’s effort to choke off Russian energy revenue and military supplies, as Kyiv seeks stronger action from allies more than four years into Moscow’s full-scale invasion.

The EU had hoped to adopt the package to mark the fourth anniversary of Russia's 2022 invasion of Ukraine in February but could not do so without unanimous backing. 

Slovakia and Hungary’s Positions

"We have received a signal that oil supplies may resume, and I can only state that we are prepared to support even a 20th sanctions package against Russia, as, according to our assessment, it would not have a significant impact on the Slovak economy. However, we will do so only once Russian oil arrives in Slovakia via the Druzhba pipeline," Slovakia's foreign minister said on Tuesday. 

Flows through Russia's Druzhba pipeline, a major crude oil artery to Europe, are expected to resume on Wednesday for the first time since a January drone strike hit the pipeline. Hungary's outgoing Prime Minister Viktor Orban was fiercely opposed to adopting more sanctions until flows resumed. He also blocked a previously agreed 90 billion euro loan for Ukraine. 

Key Measures in the 20th Sanctions Package

Maritime Services Ban and G7 Coordination

EU countries stopped short of greenlighting a full maritime services ban on Russian oil - one of the flagship restrictions in this proposal. Envoys agreed on the ban "in principle", diplomats said, but delayed taking any decision on implementation until after further coordination with the Group of Seven nations (G7). 

G7 Price Cap and Global Impact

If eventually enforced, the ban could mark an end to the G7 price cap set in 2022, which allowed third-country buyers of Russian crude oil to use Western insurance and shipping services if the purchase price did not exceed $60 a barrel - a move that was meant to mitigate the impact of sanctions on the global economy. The price was lowered to $44.10/bl this year by a coalition of G7 members and allies but not the United States. 

Targeted Sectors and Additional Restrictions

The 20th package also targets Russia's military industrial complex, particularly its drone-making capacities, its shadow fleet and would introduce a phased ban on services for Russian liquefied natural gas and icebreakers. 

The restrictions are coupled with full listings, which include asset freezes and business bans, on major Russian refineries and producers.

New Anti-Circumvention Tools and Third Country Measures

For the first time, the EU would use the anti-circumvention tool against a third country - Kyrgyzstan, ban dealings with a third-country oil port and introduce clauses protecting EU intellectual property and companies from Russian legal claims in third countries. The European Commission initially proposed listing two third country ports but diplomats only agreed to keep the one in Indonesia.

(Reporting by Julia Payne, Editing by Timothy Heritage and William Maclean)