Russian economy

Estonia’s foreign minister, Margus Tsahkna, has urged EU member states to accelerate work on a 20th sanctions package against Russia, arguing that recent economic indicators suggest pressure is beginning to bite.

In a post on X on 28 January, published ahead of the EU Foreign Affairs Council meeting in Brussels on 29 January, Tsahkna said Russia’s economy was “under real strain”, citing weak growth, high inflation, the drawdown of Russia’s liquid National Wealth Fund, and a fall in oil and gas revenues.

Russia’s economy is under real strain, with stagnant growth, high inflation, over half of its liquid National Wealth Fund already gone, and oil and gas revenues down 22% last month, the lowest since the invasion.
The conclusion is clear. Sanctions are working, and we must hit… pic.twitter.com/waAkkslVbO
— Margus Tsahkna (@Tsahkna) January 28, 2026

According to the same post, Tsahkna said Russia’s oil and gas revenues fell by 22 per cent “last month”, which he described as the lowest level since the full-scale invasion. He concluded that “sanctions are working” and said his message to EU counterparts would be that the Union should “hit” the Russian economy harder by adopting the next package quickly.

Tsahkna’s intervention comes as Brussels prepares the next round of restrictive measures, with diplomats and media reporting an expectation that the European Commission will table proposals in early 2026 and that the Council will seek agreement by 24 February 2026, the fourth anniversary of Russia’s full-scale invasion of Ukraine.

While the Commission has not yet published the legal text, reporting has pointed to a package aimed heavily at Russia’s “shadow fleet” — the network of tankers and associated service providers used to move Russian oil while reducing exposure to G7 price-cap enforcement and Western maritime services.

In recent packages, the EU has increasingly used port access bans and prohibitions on a wide range of maritime services for listed vessels. The 19th package, adopted on 23 October 2025, added 117 vessels to EU port bans and service restrictions, taking the total number of designated vessels to 557, according to the Council. It also introduced measures linked to energy revenues, including a phased ban on imports of Russian liquefied natural gas into the EU, with long-term contracts ending from January 2027 and short-term contracts to be terminated within six months of entry into force.

The same 19th package expanded listings and restrictions across financial and trade channels, including transaction bans for additional Russian banks and measures aimed at sanctions circumvention involving third-country entities, crypto providers, and dual-use goods.

The shape of the 20th package, as described by sources briefed on preparatory discussions, appears intended to build on that approach: broadening vessel listings, tightening enforcement around shipping services and intermediaries, and extending export controls designed to reduce access to goods with military or dual-use application.

A second area flagged in reporting is Russian mineral fertilisers. Reuters has described calls from some member states for measures targeting Russian fertiliser exports, noting Russia’s role as a major supplier to EU markets.

Tsahkna has also linked sanctions policy to the EU’s energy trajectory. In a statement published by Estonia’s foreign ministry on 27 January, he said the EU’s decision to end imports of Russian gas by 2027 removed a key revenue stream and argued that the next sanctions package should include additional measures against Russia’s fossil fuel sector and the shadow fleet.

The economic claims made by Tsahkna reflect a broader debate within the EU over the extent to which sanctions are constraining Russia’s fiscal position. Russia’s oil and gas taxes remain central to federal revenues, and a Reuters report published in mid-January said Russian federal budget income from oil and gas fell in 2025 to the lowest level since 2020, citing Russian finance ministry data.

For EU ministers meeting in Brussels, the political question is whether the 20th package can be assembled and agreed quickly enough to meet the February target, while maintaining unanimity among the 27 member states and ensuring measures are operationally enforceable. The EU has repeatedly expanded its toolset — from listings and asset freezes to trade restrictions and service bans — but officials and diplomats have also acknowledged that circumvention networks, particularly in shipping and cross-border trade, remain a continuing challenge.