In another of his frequent ‘announcement drops’ before entering Marine One, President Obama yesterday declared that the United States and the European Union had agreed to a new round of sanctions against Russia. These new sanctions come within two weeks of Malaysia Airlines Flight 17 being shot from the sky over Ukraine.

From The Wall St. Journal:

The EU targeted the energy, arms and finance sectors, with details due soon. It’s not a profile in courage: The EU only blocked future arms business with Russia, not past deals.

The U.S. restricted the access of three additional Russian banks to American capital markets and blocked future technology sales to Russian oil companies. The U.S. stopped short of broader sectoral sanctions on Russia’s banks. Vladimir Putin himself could be included on a future asset and travel ban list.

The question remains whether these latest moves by the West are enough for Vladimir Putin to give up his support of the pro-Russian separatists still battling the Ukrainian government on the ground in Eastern Ukraine. It is possible that the West still isn’t willing to do what it needs to do to maximize the economic pressure on Putin’s Russia.

Again, from today’s Wall St. Journal:

The U.S. sanctions, however, are notable for an institution that is not on the list: OAO Sberbank. Sberbank, majority-owned by the Russian government, is the country’s dominant lender. With more than 19,000 branches, it controls a plurality of Russia’s banking assets and boasts the highest market share in retail, business and corporate banking. It also has substantial investment- and corporate-banking activities throughout Europe.

While the EU hasn’t yet announced its list of sanctioned banks and other institutions, Sberbank is among them, according to EU officials. The bloc’s list of sanctioned institutions, which includes five state-owned banks, will be published later this week.

But the EU sanctions also have a notable gap. The EU subsidiaries of the Russian banks are exempted from the sanctions, according to European officials familiar with the sanctions.

The theory behind sanctions is that Putin feels so much economic pressure at home that the cost of supporting the weakening Eastern Ukraine rebellion becomes too high a price. However, the West now has a long track record of misjudging nearly everything Vladimir Putin does — or reacts to.

In fact, there is already a return volley from Russia following Obama’s announcement.

The first sign of retaliation came after Russia announced a ban on most fruit and vegetable imports from Poland.

Russia buys more than 2 billion euros (£1.6bn; $2.7bn) worth of EU fruit and vegetables a year, making it by far the biggest export market for the products.

Polish fruit growers said the ban was political but Russia said the move was for sanitary reasons.

Poland has been one of Putin’s strongest critics and has urged Germany and the United States to take stronger action against Russia since the Ukrainian crisis began.

Meanwhile, the feckless Secretary of State John Kerry seems to be floundering in the Ukraine crisis as he is in the Israeli-Hamas conflict. Today, Russian Foreign Minister Lavrov appeared to throw Kerry under the proverbial bus.

Lavrov said that Kerry had agreed with the need to return to “the firm basis of the consensus reached on April 17”. “We agreed that the meeting to be held in Minsk must be directed towards working out agreements on the implementation of the Geneva Statement and the roadmap proposed by the OSCE Chairperson-in-Office and Swiss President (Didier Burkhalter) as a follow-up to the Statement,” he said.

“This once again raises the question of ability to come to agreement because literally an hour after my conversation with Kerry, he (Kerry) spoke at a news conference with Ukrainian Foreign Minister Pavel Klimkin and said that Ukraine was finally ready to cease fire and begin a dialogue and that all components for the dialogue with the militias were in (Ukrainian President Petro) Poroshenko’s peace plan,” Lavrov said.

“Kerry did not mention the Geneva Statement publicly and referred to Poroshenko’s peace plan, which says that the militias must surrender their arms and hope for amnesty or they will be destroyed. You will probably see the difference,” the Russian minister said.

On the ground, the Ukrainian army has re-taken a lot of territory from the pro-Russian separatists in Eastern Ukraine. So much so that a last stand in the city of Donetsk is expected in the coming days.

If the rebels falter, Putin has a choice to make. Will he allow the Eastern Ukrainian separatists to whither on the vine? Or, like in Crimea, will Russian tanks cross into Ukraine and raise the stakes even higher for Europe and the United States?