(Bloomberg) -- The European Union is working on a new package of sanctions aimed at targeting the shadow fleet of tankers Russia is using to get its oil to market, according to people familiar with the matter.
The package, which the bloc aims to approve before the end of year, is also expected to include penalties against individuals involved in the trade. Member states are still negotiating the details of the sanctions, which need to be approved unanimously by the 27 member states.
It has gotten progressively difficult for the EU to win approval of packages in recent months, with Hungary often wielding its veto power during the negotiations.
Multiple rounds of US, UK and EU sanctions have already targeted dozens of tankers, as well as ships and services used to move Russian crude.
They have done so by prohibiting firms in the Group of Seven countries and the EU from buying oil sold above a $60 price cap. Ukraine’s allies have also imposed sanctions on several companies in third countries that are helping Russia move its crude as they seek to cut Moscow’s revenues from its most lucrative income stream.
Western companies are allowed to provide transportation, insurance and other services if the oil is sold below the threshold.
In response to the sanctions regime, Moscow has assembled a covert fleet of tankers to get around the cap and restrictions as it continues to profit from the trade.
The profits are fueling Vladimir Putin’s war machine and the US, the UK and the EU have made cutting them a priority.
The EU is also working on a bigger sanctions package that it hopes to adopt early next year when the bloc’s presidency passes from Hungary to Poland. It could include further trade restrictions, as well as more tariffs on Russian agricultural goods.
This package could be presented as soon as January, with the goal of adopting it before the symbolic date of Feb. 24, which would mark Russia’s full-scale invasion’s third anniversary.
Some countries want to see Russia’s LNG trade targeted.
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