The E.U. already imposed sanctions on Russia in March over its stealth invasion and annexation of Crimea, but those lacked teeth. In the week after Russian-backed separatist accidentally shot down Malaysia Flight MH17 on July 17, killing 298 people, some E.U. members have urged much tougher sanctions.

But that is unlikely for a number of reasons, including the fact that London is a hotbed for Russian money, and France is in the process of selling Moscow two warships.

Further, imposing sanctions requires agreement from all 28 E.U. member states.

Another key factor is Europe's reliance on Russian gas. Interestingly, several countries that import a significant number of Russian gas are pro-sanctions while others that do not import any Russian gas are still against sanctions.

Nevertheless, there's no collective political will to truly punish Vladimir Putin as long as Russian companies are supplying about 30% of Europe's gas. In fact, Ukraine claims that E.U. energy companies are sending less gas to Ukraine because of threats from Russian state oil giant Gazprom.

Consequently, Putin remains relatively undeterred, railing against NATO while continuing to train and arm separatists in eastern Ukraine.