Since Russia launched its full-scale invasion of Ukraine in 2022, the EU has been working on its 21st sanctions package. But this time, it hit a roadblock.
Greece objected to a key piece of the plan - restrictions on Russian liquefied natural gas (LNG) shipments. So now negotiators are weighing three possible workarounds to get the deal unstuck.
The EU's 21st sanctions package is supposed to hit Russia's energy revenue harder. But economic interests among member states have made it messy. "That delay occurred last week," a source close to the negotiations said.
The delays forced compromises in other parts of the package too. Efforts to prevent former Russian fighters from gaining entry into the EU have been weakened and postponed, and measures to curb certain fish shipments were dropped. The European Commission - the EU's executive body - did not respond to a request for comment about the talks.
Greece's opposition stems from its large shipping industry, which profits from transporting Russian LNG to markets in Asia and elsewhere. Any restriction on such re-exports would directly impact Greek shipowners, making compromise necessary for political consensus.
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Ambassadors from each EU country are scheduled to meet this week to hash things out. The three options on the table are not public, but insiders say they revolve around how to handle the LNG restrictions without losing Greece's support.
The wind-down period would give companies 24 months before any new LNG restrictions actually take effect. Among the other possibilities under consideration, insiders said, are abandoning the measure outright or canceling the entire sanctions package.
Another idea under discussion, according to insiders, involves allowing existing contracts to proceed as a compromise. Even if the other proposals do not get approved, the price cap freeze might still be prolonged.
Separately, the oil price cap has its own timeline. The price cap freeze was extended by one week to buy more time for negotiation.
The standard adjustment mechanism sets the cap 15 percent under the typical price of Russian Urals crude, recalculated every six months. But global fuel prices have risen because of the Iran war, which means that floating cap would actually go up.
The additional week was intended to allow representatives additional time to finalize a deal on the sanctions package, which incorporates a longer-lasting halt to the oil price cap. Talks among national governments have been tense, with countries bargaining to safeguard their own economic sectors.
This is not the first time the EU has faced internal divisions over sanctions targeting Russian energy. Previous packages required lengthy negotiations to reconcile the interests of landlocked member states dependent on Russian oil with those of maritime nations benefiting from shipping. The current dispute over LNG re-exports echoes earlier battles over coal and crude oil bans.
Meanwhile, the oil price cap remains a separate but linked tool: frozen at $44.10 per barrel, it could rise automatically if global benchmarks increase due to the Iran conflict, potentially boosting Moscow's revenues - a risk the EU hopes to manage through longer-term freezes. The 24-month wind-down option for LNG restrictions, if adopted, would give shipping firms time to adjust, but critics argue it delays meaningful pressure on Russia.
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