European Union sanctions 12 more people linked to Crimea's unrest, annexation

WASHINGTON — President Barack Obama expanded sanctions against top aides and financial associates of Russian President Vladimir Putin on Thursday as punishment for the annexation of Crimea and laid the groundwork for far broader measures against "key sectors of the Russian economy" if Putin further escalates his actions in Ukraine.

The expanded measures potentially include Russia's financial services, energy, mining, engineering and defense sectors, according to language in Obama's third executive order in two weeks. If implemented, he acknowledged, they would not only significantly affect the Russian economy, "they could also be disruptive to the global economy."

But "Russia must know that further escalation will only isolate it further from the international community," Obama said in a brief statement on the White House South Lawn.

For now, the measures target Putin's inner circle and stop well short of the kind of sanctions that have crippled Iran's economy. Those would be triggered only by a wider military incursion, and Russian troops remain massed on Ukraine's eastern and southern borders. Although Putin has said Russia has no further territorial designs on Ukraine, he has proved indifferent to Western threats.

Russia promptly retaliated by banning nine U.S. lawmakers and officials from entering the country. The list includes Senate Majority Leader Harry Reid, D-Nev., House Speaker John Boehner, R-Ohio, Sen. John McCain, R-Ariz., and three top Obama aides, the Russian Foreign Ministry said.

The Foreign Ministry denounced the U.S. sanctions as a tool "from the arsenal of the past" that would backfire. "For every hostile attack, we will respond appropriately," the statement said.

The Obama administration said it is reviewing a Ukrainian request for non-lethal military assistance to help deter a Russian incursion. But a senior official, speaking on condition of anonymity, said that "nobody wants the outcome here to be a full-bore military conflict between Russia and Ukraine," and repeated that the United States is not considering "the introduction of U.S. military forces."

The U.S. actions came as European Union leaders, beginning a two-day meeting in Brussels, imposed travel bans and asset freezes on 12 more people, closing in on Putin's inner circle.

The move brought the number of Russians and Ukrainians facing EU sanctions to 33, and French President Francois Hollande said it included a lot of the same people the United States is targeting.

The EU leaders also tasked its executive commission to prepare economic sanctions that could be imposed if one of the crisis worsens.

"We cover all economic areas," said EU President Herman Van Rompuy.

On Friday, the European Union plans to sign an agreement with Ukraine's interim government aimed at gradually bringing it closer to membership. The Ukraine crisis began four months ago, when pro-Europe demonstrators began protesting their then-government's refusal to sign the agreement.

Obama will travel to Europe next week to meet with the Europeans and other allies in several forums, including the European Union, NATO and the Group of Seven industrialized nations, which has been at least temporarily downsized to exclude Russia. In the current "political circumstances," German Chancellor Angela Merkel said Thursday, "there is no G-8."

The U.S. sanctions announced Thursday added 20 people to a handful of Russians whose U.S. and dollar assets the administration froze this week, along with what a senior administration official described as "a crony bank that handles the funds" for wealthy Russians within and outside the government.

Among those on the list are government and business leaders who have been close to Putin, some for many years. They include some of the richest men in Russia — and one Russian, Gennady Timchenko, who is in the oil-trade business in Switzerland.

The list also included Bank Rossiya, the 17th-largest Russian bank. A senior official said that would pinch Putin and his friends because Rossiya would no longer be able to conduct transactions in dollars and would find its assets frozen in correspondent accounts in European banks.

Russian Foreign Minister Sergei Lavrov and Secretary of State John Kerry spoke again by phone Thursday about Ukraine. Lavrov, a separate ministry statement said, accused the United States of "condoning" the activities of "ultranationalist and extremist forces" that he said were targeting businessmen, journalists, dissenters, Russian speakers and "our compatriots."

The Pentagon said that Defense Secretary Chuck Hagel also spoke with his Russian counterpart, Sergei Shoigu, who told him that Russian troops along the Ukrainian border were there only to conduct exercises.

On Thursday, the lower house of the Russian parliament voted 443 to 1 to admit Crimea and the metropolitan region of Sevastopol into the Russian Federation, putting some of the final procedural touches on the takeover. The bill is scheduled to be taken up Friday by the upper house, the Federation Council, where its expected approval will make Crimea officially part of the country under Russian law.

Ukraine is preparing to withdraw its 25,000 military troops from Crimean bases, which are being taken over by Russian army regulars and the pro-Russia militias they work with. Many Ukrainian service members have lived their entire lives in Crimea, and now Crimea is offering to incorporate anyone who decides to stay and take Russian citizenship into the newly created Crimean armed forces.

Tensions in the region remained high.

Shots were fired but there were no casualties as the Ukrainian corvette Khmelnitsky was seized by pro-Russia forces in Sevastopol, according to an Associated Press photographer at the scene. Another ship, the Lutsk, was also surrounded by pro-Russian forces. Ukrainian servicemen later were seen disembarking from a third ship, the Ternopil corvette.

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