New Sanctions Close In On Putin

President Barack Obama said flatly today that new sanctions on Moscow won’t “go after [Russian president Vladimir] Putin personally,” but will instead target other individuals and specific export categories in order to “change his calculus” on Ukraine.

With these remarks, Obama appears to be sugar-coating the sanctions, expected to be announced later today. Published reports and public statements yesterday by the president’s lieutenants suggest that the objective is to give the impression of a dragnet that will close in on Putin if he doesn’t moderate Russia’s actions in Ukraine.

No one has publicly confirmed details of Putin’s personal fortune, but a long story in the New York Times yesterday alleged that he is worth $40 billion or more thanks to holdings in energy and other companies. Freezing or seizing these assets is a “nuclear option” that US officials will avoid in this latest round of sanctions. Targeting the Russian president personally would make it difficult to maintain “any kind of functional relationship with Putin’s Russia,” Jeffrey Mankoff, of the Center for Security and International Studies, told Quartz.

But there is another reason for maintaining a vaguely menacing stance without actually pulling the trigger. Grabbing Putin’s money might aggravate him, but it misses his primary pressure point, which seems to be achieving historical glory. Putin’s aim in Ukraine appears to be his own legacy, which is wrapped up in notions of a “great Russia” that encompasses neighboring lands, particularly where ethnic Russians live.

Not that Putin opposes being rich—his behavior suggests that he enjoys at least the trappings of wealth. But this is also a function of holding office in the region. If you are a president in the former Soviet space, and you wish to be taken seriously by other powerful figures in the neighborhood, you almost have to be hugely wealthy. Others who have climbed to the top in industry (and crime) treat wealth as a qualification for holding a high political office.

The likely targets of new US and European sanctions include two senior Russian energy officials: Igor Sechin, chairman of Rosneft; and Aleksei Miller, head of Gazprom. A travel ban and an asset freeze could be particularly effective against Sechin, but not because he is close to Putin (which he is) or may have helped to make him rich. Instead, it’s because Sechin is the leading Russian contact for big western oil companies, including ExxonMobil, Shell, BP, and Statoil, which are working to open up Russia’s next-generation oilfields in the Arctic and Siberia.

This would threaten Putin’s actual pressure point: the oil that is Russia’s lifeblood. Putin is able to behave ruthlessly—to appear strong, regal, and ultra-patriotic to his people—only because of Russia’s oil and gas exports, which fund half the state budget. To the degree you can threaten energy, you are getting somewhere.