Western sanctions against Moscow have hurt the Russian economy and restricted some energy projects, but they have failed their main objective of persuading President Vladimir Putin to change his policy in Ukraine. It will continue to have a limited impact unless they are made tougher, the Atlantic Council argued in study released last week.

Sergey Aleksashenko, former deputy chairman of the Russian Central Bank and former chairman of Merrill Lynch Russia, said in the report that tighter restrictions could include imposing an embargo on the purchase of crude from Russian state-owned companies, banning Western companies from buying or trading Russian LNG, and making it harder for Russian state-owned companies to use Western technology.

“Even if Russia is able to sell its oil elsewhere, it will cost it more to do so, correspondingly reducing the financial resources of Putin’s regime,” Aleksashenko wrote.

The EU is expected to vote this month on renewing sanctions that expire January 31. US president-elect Donald Trump will then be able to decide whether to sign executive orders extending sanctions in March and again next summer.

But uncertainty is building on both sides of the Atlantic. Trump repeatedly praised Putin during the US elections and urged closer cooperation on geopolitical issues like ISIS. French center-right presidential candidate Francois Fillon has called for lifting the sanctions and partnering with Russia to fight immigration and terrorism.

The energy sector sanctions prevent Western companies from providing technology for Arctic, deepwater or shale oil exploration and production. This measure froze six major joint ventures that Western producers ExxonMobil, Total and Shell were pursuing with Russian companies. The restrictions took a costly toll on the joint ventures, with ExxonMobil CEO estimating the hit to its plans at $1 billion.

And yet Russian oil production has not suffered. Output rose 147,222 b/d from 2014 to 10.73 million b/d in 2015, despite an International Energy Agency estimate that it would fall 80,000 b/d. Growth has continued this year, averaging 10.91 million b/d from January-October, S&P Global Platts has reported.

Output grew despite sanctions

Russia’s deputy energy minister Kirill Molodtsov said November 9 that production has the potential to grow to 11.15 million-11.25 million b/d by 2020.

“Rus...