Does the EU want to increase sanctions? Why is the Russian economy so "resistant"

Under pressure from allies, Germany, which least wants to completely tear its face with Russia because of its energy dependence
, has fallen into line.
On June 20, local time, the Munich State Prosecutor's Office in Germany issued a statement saying that three Munich properties related to a Russian parliamentarian on the EU sanctions list and a bank account
were seized.
This is the first time since the beginning of the Russian-Ukrainian conflict that Germany has confiscated the immovable property
of Russian citizens.

At the same time, some EU countries are planning to promote the seventh round of sanctions
against Russia.
According to Reuters local time on the 20th, some EU countries (about 1/3) intend to promote a new round of sanctions against Russia and hope to provide more military support
to Ukraine.

At the upcoming EU leaders' summit on June 23-34, member states will also discuss whether to grant Ukraine EU candidate status
.
However, EU leaders are said not to discuss new sanctions against
Russia at the summit.

However, it is interesting to note that Russia, which has been subject to all-round and high-density sanctions from Western countries for more than three months, does not seem to have fared as the sanctioners expected
.
As the Economist magazine put it in early May, the Russian economy has suffered only a flesh wound and has shown "amazing resilience
.
"

In contrast, the initiators paid a huge price
.
Since Russia is an important supplier of
oil, gas, grain, metal minerals to the world.
Rising sanctions have kept already high energy and food prices rising, putting the United States and other Western countries under greater inflationary pressure
.

On June 19, local time, U.
S.
Treasury Secretary Yellen admitted in an interview with ABC TV that the sanctions imposed by the United States and other Western countries on Russia have had a negative spillover effect and affected itself
.

Take turns of sanctions

For more than three months, the United States has led Western countries to impose all-round sanctions on Russia, from the financial field to the scientific and technological field, from social media to online information, from trade to resource control, and even to culture, sports, education, animals.
.
.
An attempt to destabilize
its society by blockading Russia.
According to statistics, before the Russian-Ukrainian conflict, the West imposed more than 2,000 sanctions on Russia, and now there are more than 10,000.

As a result, Russia has become the most sanctioned country in the
world.

Time entered June, Western countries continued to increase sanctions, vowing to carry out the "blitzkrieg" against the Russian economy to the end
.

On June 2, local time, the US White House announced the imposition of new sanctions on
Russia.
Among them, the new sanctions of the US Treasury Department will target important Russian government and business officials, and the US State Department has also increased sanctions on a number of wealthy Russian businessmen who are close to Russian President Vladimir
Putin.
The U.
S.
Department of Commerce has imposed further restrictions on
the technology and other materials Russia needs.
The U.
S.
government decided to add 71 Parties from Russia and Belarus to the Entity List so that they would not be able to obtain and use products
manufactured using U.
S.
technology or software.

On June 3, local time, the European Commission announced the sixth round of sanctions against Russia, including some oil embargoes, sanctions on Russian oil tankers, banks and media
.

According to the announcement, the sanctions will take effect immediately and will gradually cut Russian oil imports
.
The EU will stop buying Russian seaborne crude oil within 6 months, accounting for two-thirds of the EU's imports of Russian crude oil, and stop buying Russian petroleum products
within 8 months.
By the end of 2022, the EU's oil imports from Russia will be reduced by 90%.

But the communiqué also said that member states that rely on Russian pipeline crude oil can be temporarily exempted until the EU Council decides
otherwise.
Member States benefiting from the exemption may not resell such crude oil and refined products to other Member States or third States
.

The EU also prohibits companies in member states from insuring and reinsuring
merchant ships carrying Russian oil.
New insurance contracts will be banned immediately, and existing insurance contracts will be phased out
within six months.

In addition, three banks, including Russia's largest bank, Sberbank, and a Belarusian bank, were excluded from
the Society for Worldwide Interbank Financial Communication system by the European Union.
EU accounting, lobbying, PR and consulting firms are also prohibited from providing services
to Russian entities.
The EU has also suspended broadcasting licenses for three Russian state media and has not allowed EU companies to advertise
in these media.

However, less than three weeks after the sixth round of sanctions was announced, some EU countries began to stir up trouble
again.

According to China News Network, recently, Polish Deputy Foreign Minister Jabrowski said that the EU is formulating the seventh round of sanctions against Russia
.
"Sanctions should be tougher," "sanctions against Russia should be extended to embargo on natural gas" and "more Russian banks should be excluded from the SWIFT global payment system.
"
He also said that "the supply of technology for industrial use to Russia must be prohibited.
"

It is reported that about one-third of the 27 EU member states (mainly northern and eastern European countries) want the EU to start implementing the seventh round of sanctions
.
Countries such as Germany prefer to focus on imposing existing sanctions and closing loopholes rather than embarking on new ones
.

No injuries

However, the economic "blitzkrieg" launched by European and American countries against Russia does not seem to have achieved the results
they expected.

According to the New York Times, the Russian economy has shown amazing resilience
in the face of severe Western sanctions.
Measures such as the withdrawal of Western companies from the Russian market have obviously failed to destroy the Russian economy
.
On the contrary, the departure of Western brands has ushered in new opportunities
for the development of Russian products and services.

Of course, Russia's social and economic life was indeed affected to a certain extent at the beginning of the large-scale escalation of sanctions, with the depreciation of the ruble and the rise in prices, but with the introduction of a series of countermeasures by the Russian side, the Russian economic order gradually returned to stability
.

First, by sharply raising interest rates, capital controls, and requiring "unfriendly countries" to buy oil and gas in rubles, the Russian ruble was "reversed" from the worst performing currency this year to the best performing currency
in less than two months.
After the strong ruble reached a certain level, in order to stabilize the rising ruble exchange rate, the Russian central bank did not hesitate to switch to the "violent" interest rate reduction mode to ensure that export trade was not affected
.

Second, the export of energy and energy products is used as a weight in exchange for room for policy adjustment in other areas
.

According to statistics, although large-scale sanctions by Western countries have caused Russian exports to drop sharply, high energy prices have compensated for the loss
of its exports.

Russia's oil export revenue surged to about $20 billion
in May due to rising global energy prices, according to the International Energy Agency's (IEA) monthly crude oil market report released on June 15.
The IEA estimates that while Russia's overall exports fell by about 3%, its crude oil and petroleum products export revenue still increased by 11%
from the previous month.

In fact, the IEA's monthly report in May showed that since the beginning of this year, Russia's oil export revenue has increased by 50%, and monthly sales are close to $20 billion
.
Among them, April exports increased by 620,000 b/d from the previous month to 8.
1 million b/d, which has returned to the January and February averages
.
This was helped by increased demand from India and China offsetting the decline in demand in the
United States and Europe.

The soaring price of natural gas, which accounts for a higher proportion of exports, has also made Russia profitable
.

France's Les Echos, citing Citibank analysts, reported in May that Russia's natural gas sales to European countries could reach a record $100 billion
in 2022 as energy prices rise sharply.

According to the New York Times, European countries have long relied heavily on Russian energy supplies
.
After the outbreak of the Russian-Ukrainian conflict, although the EU's imports of natural gas from Russia were 23% lower than in the same period last year, Gazprom's revenue was still about
double that of last year due to soaring gas prices.

Official data shows that at the St.
Petersburg International Economic Forum (SPIEF) held recently, a total of 691 cooperation agreements were signed, with a total of about 5.
6 trillion rubles (about 97 billion US dollars), an increase of 30% compared with last year's 3.
8 trillion rubles, of which Russian oil and gas companies are still the biggest winners
.

The Institute of International Finance (IIF) expects Russia's oil and gas revenue surplus this year to reach a record high of
$240 billion.

Speaking at the St.
Petersburg International Economic Forum, Putin said that "the original intention of Western sanctions is based on the wrong judgment that Russia is economically unsovereign and extremely fragile
.
" They were so obsessed with weaving dreams about how backward Russia was and insignificant in world economic trade that they believed it themselves
.
" "When planning the economic 'blitzkrieg', they did not notice the changes that have taken place in Russia in recent years, that is, after the orderly advancement of work, Russia has established a sustainable macroeconomic structure, ensured food security, implemented import substitution, established an autonomous payment system, and so on
.
"

Self-damage eight hundred

The "blitzkrieg" did not meet expectations, but the initiators have already tasted the bitter results
.

Affected by sanctions against Russia, the inflation level in the euro area has risen
across the board.

Eurostat preliminary statistics show that eurozone inflation reached an annualized rate of 8.
1% in May, the seventh consecutive monthly record high, well above the ECB's 2% inflation target
.
Core inflation, which excludes volatile energy and food prices, also beat market expectations
at 3.
8%.
The sharp rise in energy prices is the main reason for
the current high inflation rate in the euro area.
Data show that energy prices in the eurozone soared 39.
2%
year-on-year in May.

Xinhua News Agency reported that the EU's oil sanctions on Russia have strengthened expectations that oil prices will remain high and will delay the time for overall inflation to fall, further impacting
European businesses and households.
At this stage, about 30% of the EU's oil imports come from Russia, about two-thirds of which arrive by sea and one-third by pipeline
.
In 2021, the EU imported 48 billion euros worth of crude oil and 23 billion euros of refined products
from Russia.
The partial embargo on Russian oil will make the EU's energy supply even more scarce
.

ECB President Christine Lagarde has previously said that further resistance to Russian energy imports will have a significant impact and could have serious consequences
in some countries.

The United States also suffers
from inflation.

On June 10, local time, the US Department of Labor released data showing that the US Consumer Price Index (CPI) rose by 1.
0% month-on-month in May and 8.
6% year-on-year, a year-on-year increase that hit a new high
since December 1981.

Energy prices are the most important reason driving
up inflation data.
The data showed that U.
S.
energy prices rose 34.
6% year-on-year in May, of which gasoline prices rose nearly 49% year-on-year, the biggest increase
since 2005.

According to a survey conducted by the U.
S.
Department of Labor at the end of April, inflation in the United States has exceeded wage growth, real incomes have declined, and consumer purchasing power has been eroded
.
About 31 percent of U.
S.
households have "some difficulty" or "very difficulty" in paying for their daily household expenses, and up to 9 percent of U.
S.
households "sometimes" or "often" do not have enough to eat
.
At the same time, high inflation has seriously dampened US consumer confidence, and the consumer confidence index released by the University of Michigan in the United States has fallen to its lowest value
since 1952.

According to a poll released by the Wall Street Journal on the 19th, economists believe that the probability of the US economy falling into recession in the next year is 44%.

In April and January of this year, the survey data was 28% and 18%,
respectively.

Even US Treasury Secretary Janet Yellen had to admit that the sanctions against Russia have caused a lot of negative impact on US and
European countries.
On the 19th local time, Yellen said in an exclusive interview with the American Broadcasting Corporation television program that the sanctions imposed on Russia by the United States and other Western countries have had a negative spillover effect and affected themselves
.

William Ruger, director of the American Institute of Economic Research, said bluntly that the US sanctions against Russia are "lifting a stone and dropping it on its own feet.
"
Decades of research by professional scholars have found that such pressure policies are often "useless" and that sanctioned countries rarely abandon what they consider vital to their national interests
because of sanctions pressure.