The European Union this week expanded the list of Russian individuals and entities subject to asset freezes and travel bans. With President Vladimir Putin apparently unwavering in his campaign to undermine Ukraine, IWPR editor Daniella Peled asked Igor Sutyagin, a research fellow at the Royal United Services Institute, about the possible repercussions.

Do the latest European sanctions signal a new chapter in the international response to this conflict?

The new sanctions certainly mark a new phase. Finally Europe is willing to confront Russia.

There were some moves on the American side against the Russian bank sector in April which were no less serious, and which effectively meant all Russian transactions in the dollar sector were fined 30 per cent.

This was the reason why Russia’s business ombudsman, when he was asked in early July whether he saw the chances for the next round of sanctions would be worse for the Russian economy, said not at all. Not because he was optimistic, but because the situation in the Russian economy is so bad, it is hardly possible for it to get worse.

These sanctions are one more step on a very long journey.

How do you explain Putin’s intransigence despite the shooting down of flight MH17 and these latest restrictions on the Russian economy?

The problem is that Putin has entrapped himself. He has raised expectations in Russian society. According to polls, 82 per cent people expect him to be strong and decisive. If he retreats now, it shows he is weak, not strong; and a loser, not decisive – and who supports a loser?

Polls exactly a year ago, in July 2013, found that motivated supporters of Putin were marginalised to ten to 15 per cent of the population, while the mood of the rest – 67 per cent at that time – was volatile and might change from week to week. That’s why he cannot take risks with their support.

The population expects new victories, because the Crimean victory is already four months in the past and is being forgotten. As the Roman slogan goes, the public want bread and circuses. There is still bread, although there are some problems with it, but where are the circuses?

If Putin retreats now, he breaks the social contract, which was that you give up your political rights in return for stability, and this includes the stability of wealth. But for the majority there has been no increase in wealth at all. All salary rises are currently below inflation and there is zero growth, maybe negative growth.

There is a Russian saying that one never changes horses in the middle of the river. The stream is now flowing very rapidly and dangerously. This is another reason for Russia to hope – and a historical reason to believe – that the West will blink first. Russia will escalate tensions in the assumption that the West will be unable to follow and move past their pace.

As for opposition voices in Russia, there are not many and they have been marginalised. Even those who oppose Putin support him now in public, and even the liberal-orientated believe the narrative of lost empire and lost influence and feel humiliated. So they suffer the same syndrome.

How far is Putin prepared to go, then?

The Russian population will not fight for its rights; there will not be an uprising. And if there is any danger, then it won’t come from the liberal intelligentsia but from core Putin supporters in the small and medium-sized cities and in the rural population.

If there is a real risk of unrest within these segments, then Putin will have to stop because such domestic issues are more serious than external affairs.

It’s necessary to keep in mind that despite the Russian economy’s very bad circumstances, its international reserves are now 477 billion US dollars, which in the worst case could provide a certain level of stability for the regime for at least half a year, or a year.

In general the West is about comfort and Russian society is about suffering. It is easier for Russian society to suffer, and the West is absolutely not prepared to do the same. Putin and the Russian elites believe there is a chance that the West will blink first, because sanctions are painful for the Western side as well.

They calculate that the West’s suffering will have to stop first as it is not prepared to tolerate this.

A few weeks ago, it seemed that the separatists in eastern Ukraine were retreating and in disarray, and there were some suggestions that the endgame was approaching. Was this just temporary?

The Ukrainian army is approaching the cities and it will be terribly difficult for the Ukrainian government to push forward using the same military style that they used in Slavyansk.

It is very difficult to fight in cities, both militarily and politically – you risk losing international support if you kill your own civilians. And it helps the other side too. If your house is destroyed by Ukrainian shells, then you will probably back the separatists.

So it is necessary to avoid the cities, which is why the Russians are shelling Ukrainian troops from Russian territory. The original Ukrainian plan was to create a five-kilometre-wide buffer zone along the border to isolate the separatists and cut off Russian support. It was a wise plan, because there were no large settlements within the five-kilometre band. Now Russia is pushing Ukrainian forces further away and it’s obvious you can’t restrict the band to five kilometres; you need 30 kilometres to be out of range of the majority of the Russian artillery.

But within this range there are many cities, so the recent progress of the Ukrainian troops will not continue.

It’s too optimistic to expect, as the Ukrainian government has promised, that in a month there will be a “free and peaceful” Ukraine. There won’t be. Progress will slow down and Russian pressure will increase on Ukraine both in terms of the trade war and the shelling.

What are the wider repercussions of this conflict in terms of Russia’s future plans?

Crimea established a pattern that if you bully everyone, then you get what you want and get away with it.

The Malvinas lie much closer to Argentina than the UK. What will stop [Buenos Aires] from grabbing them? The UK has no military capability to prevent that.

When Iran said it wasn’t satisfied with the nuclear deal it was offered, it wanted all sanctions removed, for a promise to consider perhaps complying.

This all follows the same pattern, and that’s the net outcome of the Crimean operation. The only way to stop that from cementing unbalanced brains is to show that a Crimea-style enterprise has no chance for success.

It is unwise to think just about Russian claims. Think about [Western] interests because there are lots of Crimea-style encounters on your doorsteps and even in your cities. You need to prove they have no chance of success.

MH17 helped the West to explain to its citizens why this is not about Russia-Ukraine relations.

This is about a fundamental change in the world order where it is possible to violate international law with impunity.