New US sanctions over Ukraine crisis hit Russia\\\'s top firms

WASHINGTON/MOSCOW, July 17 (Reuters): President Barack Obama imposed sanctions on some of Russia's biggest firms for the first time, striking at the heart of Vladimir Putin's powerbase by targeting companies closest to him over Moscow's failure to curb violence in Ukraine.
After months of measures that hit only individuals and smaller firms, Washington imposed sanctions on Russia's largest oil producer Rosneft, its second largest gas producer Novatek and its third largest bank Gazprombank. The firms are run by Putin allies who have become wealthy during his tenure.
Moscow denounced what it called primitive revenge for events in Ukraine and pledged to retaliate. Putin said the US  sanctions would hurt US energy companies and bring relations to "a dead end". His prime minister, Dmitry Medvedev, called the sanctions evil, said they would not "bring anyone to their knees" and that Russia would pay attention to defence spending.
The sanctions in effect close the firms to medium- and long-term dollar funding. Other targets include Vnesheconombank, VEB, which acts as payment agent for the government, and eight arms firms, including the producer of the Kalashnikov assault rifle. However, Washington stopped short of freezing the companies' assets, closing off the short-term funding they need for day-to-day operations or stopping US firms doing business with them. Several were quick to say it was business as usual.
Russia's rouble-traded stock market and the rouble itself fell on opening but did not collapse. After stabilising, Rosneft was down around 4.5 per cent and Novatek 7.5 per cent. The MICEX index was off 2.6 per cent.
There was no suggestion of disruption to production by Rosneft, by output the world's biggest oil company listed on a stock exchange, which singlehandedly produces 4 per cent of the world's oil, more than any OPEC country apart from Saudi Arabia.
An actual disruption to such a huge producer could in theory cause a global energy crisis, but there was no sign of one on Thursday, with oil prices only fractionally higher.
The measures mean that Washington has moved far further to punish Russia than its EU allies, who collectively do 10 times as much trade with Russia as the United States and depend on Moscow for natural gas. Nevertheless, the European Union also said it was imposing new sanctions and would draw up a list of targets by the end of the month. It will block new loans to Russia through two development banks.