EU governments have agreed to impose a host of economic sanctions against Russia, taking aim at bank financing, technology, defence equipment and the oil industry, according to EU sources.
At meetings held today in Brussels, it was also agreed that Russian state-owned banks would be barred from selling shares or bonds in Europe.
Today's developments mark the most wide-ranging sanctions to have been imposed on Russia to date.
The EU hopes the measures will serve to punish the Kremlin for its support of pro-Russian rebels in eastern Ukraine. However, Moscow has denied supplying the rebels with heavy weaponry.
Dutch foreign minister Frans Timmermans was confident that the sanctions would have a significant impact.
"Today in Brussels... they are now discussing the so-called 3rd phase package...capital market restrictions, and I think they will have a far-reaching and immediate effect," said Timmermans.
Furthermore, the EU is expected to announce on Wednesday that a slew of Russian officials will be subject to asset freezes and travel bans.
The measures endorsed today will take effect on July 31 and are set to be reviewed after three months