- The Washington Times - Wednesday, July 16, 2014

President Obama announced new economic sanctions Wednesday against Russia, hitting major energy, financial and defense companies in a bid to end fighting in eastern Ukraine at the end of a day in which the Pentagon accused the Kremlin of gathering more forces at the border and a British newspaper reported that Moscow would reactivate a Cold War era spy base in Cuba.

Mr. Obama said the “continued provocations in Ukraine” by America’s former Communist adversary left the U.S. with no choice but to go after some of the most powerful Russian companies, which also have close ties to Russian President Vladimir Putin. The European Union also announced a new round of sanctions against the Kremlin on Wednesday evening.

The sanctions imposed by the U.S. Treasury Department tighten a noose around energy giants Novatek and Rosneft, financial firms Gazprombank and VEB and eight Russian arms firms that produce an array of weapons from small arms to mortar shells and tanks.

“I’ve repeatedly made it clear that Russia must halt the flow of weapons and fighters across the border into Ukraine; that Russia must urge separatists to release their hostages and support a cease-fire; that Russia needs to pursue internationally mediated talks,” Mr. Obama told reporters at the White House.

“I made this clear directly to Mr. Putin,” he said. “So far, Russia has failed to take any of the steps I’ve mentioned. In fact, Russia’s support for the separatists and violations of Ukraine sovereignty [have] continued.”

Mr. Putin dismissed the sanctions Wednesday during a trip to Brazil.

“They are undermining the positions of their energy companies,” he told a news conference. “They made one mistake, and now they insist on making another one.”

And the Kremlin has been taking its own countering steps recently. The Guardian newspaper reported Wednesday that Russia has reached a deal to reactivate a spy base in Cuba that has been closed since 2002. The deal, reached earlier this month in exchange for concessions on Cuba’s debt to Russia, will open a signals-intelligence facility in Lourdes, south of Havana and about 155 miles off the U.S. coast.

Pavel Felgenhauer, a Moscow-based defense analyst, told the paper that the decision to open the base, which opened in 1967, was a “PR move” by the Russians to give America the “middle finger.”

“Lourdes gave the Soviet Union eyes in the whole of the Western Hemisphere. For Russia, which is fighting for its lawful rights and place in the international community, it would be no less valuable than for the USSR,” Vyacheslav Trubnikov, the former head of the nation’s foreign intelligence service, told the Russian newspaper Kommersant.

And on the ground, according to a Pentagon spokesman Wednesday, Russia has moved back some of the troops it had withdrawn from its Ukrainian border and was shipping weapons to Russian-speaking separatists who want to secede and become part of Russia, as the Crimea did this spring.

U.S. Army Col. Steve Warren said about 1,000 troops have been added there in the past several weeks and “we believe there are now between 10,000 and 12,000 Russian troops on the border,” though that number is not close to the peak of tens of thousands earlier this year.

“We also have reason to believe that there is some weaponry — possibly some heavy weapons — that are flown across the border into Ukraine for use by the separatists. So we have seen evidence that the Russians are continuing to support the separatists,” Col. Warren said.

The separatists have been losing ground in recent weeks to the central government in Kiev, but they prepared Wednesday to take a stand in their strongholds of Donetsk and Luhansk and were making preparations for bloody urban fighting.

According to The Associated Press in Ukraine, pro-Russia separatists began shipping their families away on buses for Russia and digging in to the cities and deploying artillery. One guerrilla in Donetsk, who declined to identify himself, told the AP that he’s happy his family has left so he can concentrate on fighting.

“It is easier for us this way. It is easier to fight. Your soul is not ripped into two, because when they’re here, you think about war and about your family — if they are OK or not,” he said. “When you know that they are safe, it is easier to go to fight.”

The rebels have recently deployed such advanced weapons as tanks and multiple rocket launchers, which Western nations say could only have come from Russia, though Moscow denies the charge.

Mr. Obama turned to the Ukraine unrest as his administration is beset by crises around the globe, including the Israeli-Palestinian conflict, the expanding threat of the Islamic State (IS) and flagging nuclear talks with Iran.

Republican critics have blamed Mr. Obama’s weak leadership for fueling conflagrations throughout the world as well as setting off the crisis of unaccompanied illegal-immigrant children surging across America’s souther border.

In expanding the sanctions, Mr. Obama acknowledged that previous penalties had failed to force Mr. Putin to change course in Ukraine.

The administration stopped short of clamping down on entire segments of the Russian economy, instead hammering a handful of big companies.

“These sanctions are significant, but they are also targeted — designed to have the maximum impact on Russia while limiting any spillover effects on American companies or those of our allies,” Mr. Obama said.

The new U.S. penalties came as European leaders meeting in Brussels hammered out broader financial penalties than the current travel bans and asset freezes aimed at individual Russian businessmen and politicians — which is the most the U.S. can really do by itself. U.S. officials are participating in the talks in Brussels.

The EU agreed Wednesday night to ask the European Investment Bank to sign no new financing agreements with Moscow and to suspend financing of the new European Bank for Reconstruction and Development operations in Russia.

In addition, the Europeans also signaled a willingness for the first time to go after Russian companies “that are materially or financially supporting actions undermining or threatening Ukraine’s sovereignty, territorial integrity and independence.” They ordered their foreign ministers to draw up a list of such people or entities by the end of July.

“Russian leadership will see once again that its actions in Ukraine have consequences, including a weakening Russian economy and increasing diplomatic isolation,” Mr. Obama said.

President Dalia Grybauskaite of Lithuania — an EU member that borders Russia and also a former Soviet republic — said Europe had to get tougher with Moscow “because if Putin’s aggressive policy isn’t stopped, he will go further.”

Maggie Ybarra and Douglas Ernst contributed to this article, which is based in part on wire service reports.

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