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Poland, Baltics want aluminium, LNG bans in new EU sanctions package on Russia

By Julia Payne

BRUSSELS, Jan 23 (Reuters) - Poland and the Baltic states are calling for import bans on Russian aluminium and liquefied natural gas (LNG) for the European Union's 13th package of sanctions against Moscow over its Ukraine invasion, a Polish official said.

The EU is aiming to pull together more measures ahead of the second anniversary of the Ukraine war at the end of February. But diplomats said they are running out of options that would have enough support from EU member states.

Poland and the Baltic countries have been the staunchest supporters of sanctions ahead of every new package.

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These countries are also suggesting more measures to combat sanctions circumvention and to tighten sanctions in the aviation sector, the Polish official said.

They also want to expand the list to include products that can be used to make drones and align sectoral measures imposed on Russia with measures against Belarus in another effort to prevent circumvention.

"The big items are already sanctioned and the big ones left like LNG and nuclear are not available," a senior EU diplomat said.

The EU diplomat said that each new package was moving to close the loopholes and there was a long list of new entities and individuals that could be added.

The previous package, agreed in December, managed to push through two new bans - diamonds and liquefied petroleum gas (LPG), known as propane and butane.

The package banned direct Russian diamond imports as of Jan. 1, with an indirect ban coming in March in coordination with the Group of Seven countries.

"It's (13th package) at the embryonic phase. We might be able to unblock one thing from that (Polish) list but we expect lots of new listings of individuals from the Commission rather than sectoral," a second diplomatic source said.

"There is a push to include more third country companies but it's a big issue because it risks trade ties."

EU officials said the 13th package will focus more on bad actors and circumvention, adding that about 60% of sanctioned goods reach Russia via China. Central Asia has been the other major artery for goods to Russia.

However, there is no consensus on how this can be stopped. Some officials and diplomats caution that adding entities or third countries risks reputational damage while others see the risks as worthwhile.

"We have the mechanism since the 11th package, which we can use - we haven't used it yet - to sanction countries ... for aiding sanctions circumvention as well," the senior EU diplomat said.

"Some (EU) countries think ...(the mechanism) is already a deterrence but in my mind we have to use it at least once to make it a deterrent." (Reporting by Julia Payne. Additional reporting by Jan Strupczewski. Editing by Jane Merriman)