Russia urges West to refrain from sanctions

A023211312.jpgPARIS/MOSCOW (Reuters) – Russia and European powers took a step back from confrontation over Georgia on Friday, with Moscow urging the EU not to rush into punitive action and France saying now was not the time for sanctions.

Western governments have criticized Russia for sending troops deep into its ex-Soviet neighbor Georgia and recognizing Georgia’s two breakaway regions as independent, drawing comparisons with the rhetoric of the Cold War.

Georgia said it would cut diplomatic ties with Russia after Moscow recognized its rebel South Ossetia and Abkhazia regions. A Russian Foreign Ministry source told RIA news agency Moscow would respond by closing its embassy in Tbilisi.

“It would be very awkward to have a diplomatic relationship with Russia” while Moscow was setting up diplomatic relationships with South Ossetia and Abkhazia, Georgian Foreign Minister Ekaterine Tkeshelashvili said.

Diplomats said they received signals from the Kremlin that Russia would retaliate if the EU imposed punitive measures when leaders of the bloc, which depends on Russian energy imports, meet in Brussels on Monday.

But Russian oil companies and government officials denied a British newspaper report that they were preparing to restrict oil supplies in response to sanctions.

A senior diplomat for EU president France said sanctions would not be adopted at the summit. That message contradicted remarks on Thursday by French Foreign Minister Bernard Kouchner, who said sanctions were among the options on the table.

“The time to pass sanctions has certainly not come,” the French diplomat said.

“BIASED” G7

A spokesman for Russia’s Foreign Ministry said some countries — which he did not name – were trying to take the EU down “the road to confrontation.”

“We hope that reason will prevail over emotions, that EU leaders will find the courage to refrain from a one-sided assessment of the conflict,” Andrei Nesterenko told a news conference in Moscow.

The Russian Foreign Ministry earlier issued a strongly worded statement saying the Group of Seven nations, which this week condemned Moscow’s actions in Georgia, was “biased.”

In a combative interview on Thursday, Prime Minister Vladimir Putin accused the United States of orchestrating the conflict in Georgia – a charge the White House denied.

Putin also hinted Russia’s cooperation with the West on issues such as trade and nuclear non-proliferation could be at stake in the row over Georgia.

Russia mounted a huge counter-attack on land, sea and air after its pro-Western neighbor Georgia sent in troops in a failed attempt to retake its breakaway region of South Ossetia three weeks ago.

Western states accused it of using excessive force and seeking to establish a permanent troop presence deep inside Georgia, a country the West views as a strategic transit route for energy exports from the Caspian Sea.

The Kremlin said it acted to prevent Georgia wiping out the South Ossetian population and was staying on to prevent any further acts of aggression.

It has also accused the United States and NATO of adding to tension by deploying warships to the Black Sea, where the Russian navy has traditionally been dominant.

ENERGY DEPENDENCE

Russian President Dmitry Medvedev had bags under his eyes and showed signs of tiredness during a summit in Tajikistan this week at which Russia’s closest regional allies gave only qualified support for the Kremlin’s actions in Georgia.

No state has yet followed Moscow’s lead and recognized Georgia’s breakaway regions.

Western policy-makers drafting a response to the Kremlin’s actions must weigh the fact that Russia supplies more than a quarter of Europe’s gas and that its support is vital to maintain pressure on Iran over its nuclear program.

European diplomats said on Friday they were expecting Russian retaliation if the EU took punitive measures.

“They’ve been saying loud and clear that they feel they could do whatever they want with impunity,” said one diplomat.

“But I think any kind of reaction they would take to the EU would be in kind, like visa restrictions or a business contacts freeze. I don’t think the retaliation would include the kind of things like restricting oil.”

Georgia is important to Western government’s energy strategies because it hosts the only pipelines shipping oil and gas from the Caspian that do not pass through Russia.

Indicating the conflict over Georgia could jeopardize that role, Azerbaijan’s state oil company SOCAR said it expected next year to send up to 400,000 tons of crude to a Russian pipeline and not the BP-led Baku-Tbilisi-Ceyhan pipeline.

It cited instability in Georgia as one of the reasons. An explosion at a bridge disrupted exports of Azeri oil by rail to the Black Sea during the war.

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