By Daphne Psaledakis, David Brunnstrom and Timothy Gardner
WASHINGTON (Reuters) -The United States on Friday imposed extensive sanctions against Russia, targeting more than 500 people and entities to mark the second anniversary of Moscow's invasion of Ukraine and retaliate for the death of Russian opposition leader Alexei Navalny.
President Joe Biden said the measures aim to ensure Russian President Vladimir Putin "pays an even steeper price for his aggression abroad and repression at home."
The sanctions targeted Russia's Mir payment system, financial institutions and its military industrial base, sanctions evasion, future energy production and other areas. They also hit prison officials the U.S. says are linked to Navalny's death.
"Doesn't Washington realize that sanctions won't take us down?" Russia's ambassador to Washington, Anatoly Antonov, was quoted as saying on his embassy's channel on the Telegram messaging app.
The United States later on Friday also imposed sanctions on Russia's leading tanker group, Sovcomflot, accusing it of being involved in violating the G7's price cap on Russian oil. Also targeted were 14 crude oil tankers in which it has an interest.
"Sovcomflot as a whole, as a parent company, has been implicated in price cap violations in addition to deceptive activity," a senior Treasury official said.
The Biden administration is seeking to continue supporting Ukraine as the country faces acute shortages of ammunition, with the approval of more U.S. military aid delayed for months in the U.S. Congress. The European Union, Britain and Canada also took action against Russia on Friday.
The U.S. Treasury Department targeted nearly 300 people and entities, while the State Department hit over 250 people and entities and the Commerce Department added over 90 companies to the Entity List.
The United States and its allies have imposed sanctions on thousands of Russian targets since Russia invaded neighboring Ukraine on Feb. 24, 2022. The war has seen tens of thousands killed and cities destroyed.
However, Russia's export-focused $2.2-trillion economy has proved more resilient to two years of unprecedented sanctions than either Moscow or the West anticipated.
"We must sustain our support for Ukraine even as we weaken Russia's war machine. It's critical that Congress steps up to join our allies around the world in giving Ukraine the means to defend itself," Treasury Secretary Janet Yellen said in a statement.
Brian O'Toole, a former Treasury official, said the action, while involving a lot of names, was short on impact, because the majority of the entities targeted are Russian rather than foreign firms, and are easily replaceable as Moscow seeks to skirt sanctions.
But former senior Treasury official Ben Harris said the magnitude of the sanctions imposed by the United States alone was formidable.
U.S. Secretary of State Antony Blinken said Friday's move was Washington's largest number of designations in a single Russia action.
PAYMENT SYSTEM
Among the actions taken, the U.S. Treasury imposed sanctions on state-owned National Payment Card System, the operator of the Mir payment system. Mir payment cards have become more important since U.S. rivals suspended operations in Russia.
It also targeted over a dozen Russian banks, investment firms, venture capital funds, and fintech companies.
The United States also targeted Russia's future energy production and exports, taking further aim at the Arctic LNG 2 project in Siberia. In November, Washington imposed sanctions on a major entity involved in the massive project.
On Friday, the State Department targeted Russia's Zvezda shipbuilding company, which it said is involved in the construction of up to 15 highly specialized LNG tankers intended for use in support of Arctic LNG 2 exports.
The United States also imposed sanctions on entities based in China, Turkey, the United Arab Emirates, Kazakhstan and Liechtenstein over the evasion of Western sanctions on Russia and backfilling.
The spokesperson for China's embassy in Washington, Liu Pengyu, called the sanctions against the Chinese firms "a typical move of economic coercion, unilateralism and bullying" by the United States.
Washington has increasingly sought to crack down on Russia's circumvention of its measures.
Peter Harrell, a former National Security Council official, said the moves sent a clear message that the U.S. is prepared to take action against circumvention.
"I see this as kind of a valuable but incremental step that is within the strategy they've been deploying over the last two years," he said.
The Biden administration also imposed new trade restrictions on 93 entities from Russia, China, Turkey, the United Arab Emirates and elsewhere for supporting Russia's war effort in Ukraine.
The State Department also targeted three Russian Federal Penitentiary Service officials it accused of being connected to Navalny's death, including its deputy director who it said reportedly instructed prison staff to exert harsher treatment on Navalny.
Navalny, 47, fell unconscious and died suddenly last week at the penal colony above the Arctic Circle, the prison service said. Biden has directly blamed Putin for Navalny's death.
The U.S. action also targeted people involved in what the State Department called the forcible transfer or deportation of Ukrainian children.