In the wake of the Ukraine crisis, European leaders meeting today (20 March) in Brussels will likely limit themselves to adding a few names on the sanctions blacklist and possibly cancelling the June EU-Russia summit, diplomats said, with one slamming the West for losing the 'propaganda war' over Crimea.

Speaking to a small number of journalists, the ambassador of an EU country said EU leaders were keeping their “ammunition” to impose sanctions on Moscow, should Russia take aim at Eastern Ukraine, which in his words conveyed the message that the EU has accepted that “Crimea is gone”.

The diplomat recalled his personal experience to illustrate the fact that with the annexation of Crimea, EU-Russia relations are returning to something similar to the Cold War.

He said that if someone had told him ten years ago that a decade later, the EU would be facing such a situation in Europe, he would not have believed it.

“We look, as the Western world, very weak. The problem is that we, as Western democracies, are facing a completely different system of governance under Putin,” the diplomat said, referring to the return to autocracy which has been growing in Russia since the reelection of Vladimir Putin as President, in May 2012.

The diplomat argued that for EU countries, implementing a visa ban, or an asset freeze, was “a difficult operation” because those countries had “normal constituencies” and could not “summon” their parliaments the way Putin was doing.

The diplomat said that he had wrongly thought that Crimea would become the 84th member of the Russian Federation, in three or four weeks after the 16 March referendum, which the EU said was “illegal”.

On Tuesday, Putin signed a treaty in Moscow, making Crimea part of Russia again, six decades after Nikita Khrushchev gave the peninsula to Ukraine, in 1954.

“He [Putin] made it [an 84th member] this week. We are dealing with a completely different system of governance”, the diplomat exclaimed. The official added that two days ago, he had been watching a talk show on German TV with a representative of a Russian television station, based in Berlin, who was one of the participants.

“It’s incredible how he was arguing. We are short of this machinery. So far we are losing this propaganda war”, the diplomat said.

Stage three of sanctions?

Asked what should be expected from the summit, the diplomat said he didn’t believe that EU leaders would make the decision to move to stage three of the sanctions, as decided at their extraordinary summit, held on 6 March.

The biggest challenge at the summit, the diplomat said, was that the EU needed to remain credible, by delivering on the decisions taken at the previous 6 March summit. Those in fact had appeared more courageous than previously expected.

According to the 6 March decisions, the first stage of sanctions was a suspension of EU-Russia talks on visa liberalisation, and on a new basic bilateral agreement. The second stage took place after the Crimea referendum, when EU foreign ministers agreed on 17 March to impose visa restrictions and asset freezes on 21 Russian and Ukrainian officials for their roles in the events leading to referendum which paved the way for Russia's annexation of Crimea. The list includes three Russian military commanders in Crimea, and districts bordering on Ukraine. [see list on page 12-13 of the EU Official Journal].

Stage three consists of economic sanctions, although little detail is provided in the remarks by Council President Herman Van Rompuy which replaced the usual summit conclusions. The Russian parliament has been preparing legislation to confiscate Western property in the case of more severe Western sanctions.

The diplomat said EU leaders would most certainly discuss “the trigger” for stage three. He expected that leaders would decide to stay on stage two, and perhaps add more names to the list of persons under sanction. The trigger for stage three could be “the destabilisation of Eastern Ukraine”, he said, adding that this was his personal opinion.

“We are in stage two. It seems so, as we accepted that Crimea has gone. I know it, it’s reality”, the diplomat said. He added:

“We cannot expend all our ammunition now, by rushing to economic sanction right now. What kind of leverage would we have if the Russians start operations in Eastern Ukraine”, he asked, rhetorically.

… or adding names to the list

Other diplomats said that officially, the EU would never accept that Crimea is part of Russia. But they also said that the most realistic outcome of the summit would be to have more names added to the list of persons subject to sanctions.

So far two categories are on the list – parliamentarians and military commanders. Two other categories would be the presidential administration and the Russian media. One name that is reportedly been mentioned Dmitry Kiselyov, head of Rossiya Segodnya, the Russian state news agency, who recently said on his Vesti Nedeli (News of the Week) program that Russia could turn the US into radioactive ash.

But diplomats explained that adding names was not an easy exercise, because the EU had to make sure that any case could be defendable in court. According to information obtained by EURACTIV, several Ukrainian officials on the EU sanction list, including former Prime Minister Mykola Azarov, have hired Western lawyers to claim that their addition to the list was unlawful.

Another likely decision of the summit would be that the EU-Russia summit in June would be cancelled, diplomats said.

The Ukrainian ambassador to the EU, Kostiantyn Yelisieiev, told EURACTIV in an exclusive interview, that the sanctions taken so far by the EU were “a mosquito bite” for Putin. He advised that the best thing the EU could do is to prove its unity and firmness vis-à-vis Russia. [Read the full text of the interview here.]

EU leaders will discuss the Ukraine crisis over dinner. A diplomat told EURACTIV he expected that this would be a very long night.