The US Purposefully Created As Much Uncertainty As Possible About How Its Sanctions Should Be Interpreted

If you've been having trouble figuring out just what the impact of the U.S.' latest round of sanctions against Russia is going to be, don't worry: That is exactly what the Treasury Department intended.

In an interview with the FT's Neil Hume, University of Houston finance professor Craig Pirrong says most of the deals firms targeted by the sanctions make are so-called "prepay" deals.

But there are so many moving parts in these deals that banks will err on the side of caution and refrain from doing business with the firms.

"The US Treasury has tried to exploit this sort of ambiguity in the past to enhance the impact of the sanctions that it actually does levy," Pirrong said. "I think that's likely to be the effect here as well."

Others believe the prepay deals, and the short-term funding windows they imply, will blunt the impact of the sanctions. The sanctions target financing that lasts at least 90 days, but most oil deals require financing of a much shorter duration. Russia's top oil producer, Rosneft, said on Friday it would continue to work on its existing projects and agreements and honor its obligations despite U.S. sanctions on the company over Moscow's role in the Ukraine crisis.

The company, in which BP holds a 19.75 percent stake, also said it has sufficient liquidity to service its debts, and its financial position allows it to deliver on the key indicators of its strategy and dividend policy.

"The company is currently in the process of a legal review of the announced sanctions, and is consulting its international partners," Rosneft said in a statement.

Brent futures showed little reaction to the Treasury announcement, and were basically flat on the week until the Malaysia crash.

Since that incident they've climbed about 0.5%. And there is a chance that complacency could change. Former Pentagon and Treasury official Neal Wolin believes the shooting down of Malaysia flight MH17 will cause Europe to come in with its own sanctions.

"[Europeans] have economic interests which are very much intertwined with Russia, in particular on energy but also with the respect to trade," former Pentagon and Treasury official Neal Wolin said Friday on CNBC's "Squawk Box." "It's not likely they're going to go from zero to 60 all in one fell swoop. They're going to put them on increasingly and with more focus."

(Reuters reporting by Vladimir Soldatkin)