Obama Says Jet Downing Pushing EU Toward Russia Sanctions

President Barack Obama said he expects the shooting down of the Malaysian airliners to push European nations toward tougher sanctions against Russia.

Obama said the “intertwined” economies of the European Union and Russia has been a concern for U.S. allies as they respond to Russian involvement in the turmoil in Ukraine.

“Despite some of those commercial concerns, we’ve seen Europe move with us,” Obama said in an interview with CNBC today. “Not always as fast as we’d like, but they get there.”

The U.S. last week imposed penalties on large Russian banks, energy companies and defense firms that prevent them from accessing U.S. equity or debt markets for new financing with a maturity beyond 90 days. The EU is preparing to sanction Russia’s most senior spies and security officials and has laid out options for applying sanctions to Russian banks.

The Micex Index closed up 0.2 percent at 1,408.80 for a loss since Feb. 28, a day before President Vladimir Putin’s intervention, of 2.5 percent. The yield on local-currency bonds due February 2027 rose six basis points to 9.14 percent, extending the increase in the period to 78 basis points. The ruble, which has advanced 2.5 percent since February, lost 0.3 percent to 35.0045 per dollar.

Russian Weapons

The U.S. has blamed the pro-Russian separatists, supplied with weapons by Russia, for shooting down of the airliner, killing all 298 aboard.

That incident “may stiffen the spine of our European partners moving forward,” Obama said in the CNBC interview.

Obama also said the Federal Aviation Administration’s decision to halt U.S. flights to Israel -- since lifted -- was based strictly on security concerns because of rocket fire in Israel’s conflict with Hamas militants.

“We have not made decisions when it comes to airline safety based on not just politics, but even our strong alliance with Israel,” Obama said “We have to just look at the facts.

Obama taped the interview earlier today in California, where he called on Congress, during remarks at Los Angeles Trade-Technical College, to curb the corporate inversions loophole that allows companies to use cross-border mergers to escape U.S. taxes.