Russia Responds to New US Sanctions Over Chemical Attack

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The tough message from Prime Minister Dmitry Medvedev marked what the Kremlin sees as a red line, reflecting growing dismay with announced USA sanctions that have sent the Russian ruble plummeting to its lowest level in two years.

But the punitive measures triggered a furious reaction from Moscow.

Peskov was referring to the nerve-agent attack on former spy Sergei Skripal and his daughter Yulia in March.

They are aimed at punishing Putin's government for having "used chemical or biological weapons in violation of global law", spokeswoman Heather Nauert said in a statement.

"The Russian side voiced categorical disagreement with the new sanctions recently announced by Washington with reference to some allegedly existing information on Russia's involvement in the so-called Skripal case", the Foreign Ministry said in a statement posted on its website.

Dmitri Trenin, director of the Carnegie Moscow Center and a former colonel in the Russian army, said the State Department's move looked like the latest salvo in what he called a hybrid war.

Russian Federation warned the United States on Friday it would regard any U.S. move to curb the activities of its banks as a "declaration of economic war" and would retaliate, as new sanctions took their toll on the ruble and USA lawmakers threatened more.

The new sanctions come in two tranches.

Russian prime minister Dmitry Medvedev warned the U.S. today that the applications of sanctions by Congress and Donald Trump would amount to an act of "economic war".

"We are being threatened with further escalation of sanctions pressure", she said.

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"And it would be necessary.to react to this war economically, politically, or, if needed, by other means", he said.

Kremlin spokesman Dmitry Peskov, speaking to reporters on a conference call, said the U.S. move was "absolutely unfriendly", but said Moscow continued to hope that for an improvement in battered U.S. -Russia relations.

But unless Russia agrees within 90 days to stop all use of chemical weapons and permit inspections to confirm their elimination, additionally mandated measures could cut off nearly all trade between the two countries, prohibit landing rights for Russian airlines, and lead to a suspension of diplomatic relations.

"The Russian currency has been caught in a flawless storm of weakening crude oil prices and the new United States sanctions, in addition to the threat of even tougher punitive measures in the coming months", said Lilit Gevorgyan, economist at IHS Markit.

The new U.S. sanctions would cover sensitive national-security controlled goods, a senior State Department official told reporters. Among the possible restrictions included in the second round of sanctions would be ban of Aeroflot flights to the US.

Medvedev's tough tone was in stark contrast with past statements by President Vladimir Putin and his lieutenants, who have taken a nonchalant posture while talking about US and other Western sanctions, seeking to downplay their impact on the Russian economy.

Russian markets plunged in April after President Donald Trump 's administration slapped its harshest sanctions to date against the country.

"There are actions to directly counter U.S. sanctions directed against other countries, such as Iran and North Korea".

On Thursday, Russia and China blocked a USA proposal at the United Nations to blacklist a Moscow-based North Korean banker and two other entities as punishment for breaking U.N. sanctions created to get Pyongyang to negotiate abolishing its nuclear weapons.

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