'Your World' on Russian sanctions

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Biden’s Russia sanctions are a ‘clear message’ to Putin: Sen. Cardin

Democratic senator tells ‘Your World’ new sanctions are meant to hurt Russian economy and operations.

This is a rush transcript of "Your World with Neil Cavuto" on February 22, 2022. This copy may not be in its final form and may be updated.

NEIL CAVUTO, FOX NEWS ANCHOR: Thank you, Martha.

Well, let the sanctions begin, the president making clear he's targeting Russian bank, sovereign debt and a lot of rich guys, a lot of oligarchy, among them, Vladimir Putin himself.

We are on top of it all, on top of Antony Blinken, the secretary of state, meeting with the Ukraine foreign minister. They're going to be addressing the press shortly. We will get an idea what they're thinking and what news they could be making, all of this at the same time Wall Street was free- falling.

As bad as a 482-point drop looks, it had been a lot worse, down about 700 points. You know the drill. When Wall Street doesn't know what could be next, and it's confused, it sells first, ask questions later.

But, right now, we can tell you the S&P 500 is in and out of correction territory, when it falls 10 percent or more, the Nasdaq very close to bear market territory, and all because the possibility of a freeze on financial assets out of Russia that could boomerang on banks not only in Europe, but here in the United States as well, that whatever pain we force on Russia could be felt globally.

The president was warning about it today. We're going to go into a lot more detail about the implications of that today.

Welcome, everybody. I'm Neil Cavuto. And this is "Your World."

We have got you covered on all of this with Hillary Vaughn at the White House. We got Trey Yingst in Kyiv, Ukraine, and Jennifer Griffin following all of this, as she has so ably, from the Pentagon.

Let's begin now with Hillary at the White House.

Hey, Hillary.

HILLARY VAUGHN, FOX NEWS CORRESPONDENT: Hi, Neil.

Well, the president met moments ago with the foreign minister of Ukraine to ensure him that the U.S. is committed to responding in kind or responding directly to Russia's aggression and detailing the economic sanctions that he rolled out today that are targeting several Russian financial institutions.

President Biden did have harsh words for Putin today. But Putin apparently was not listening, according to his press secretary, who said Putin was in a meeting. But Biden did deliver an economic blow to Putin and some of Russia's key financial institutions, while also warning that targeting Russia, one of the largest oil and gas suppliers in the world, could turn into an economic blow to Americans at the pump.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: Who in the lord's name does Putin think gives him the right to declare new so-called countries on territory that belong to his neighbors?

And if Russia proceeds, it is Russia, and Russia alone, that bears the responsibility.

As we respond, my administration is using every tool at our disposal to protect American businesses and consumers from rising prices at the pump.

(END VIDEO CLIP)

VAUGHN: The sanctions that Biden announced today against Russia include blocking Russian financial institutions from doing business in the U.S., placing restrictions on sovereign debt, cutting them off from U.S. markets, and also targeting Russian elites and family members with close ties to Putin.

But some Republicans say this is not enough.

(BEGIN VIDEO CLIP)

SEN. TOM COTTON (R-AR): I have been calling for months now for the kind of punishing sanctions that Joe Biden and Western leaders keep promising, but never revealing, permanently canceling the Nord Stream 2 pipeline, clamping down on its financial industry and its access to the international banking systems.

These are the kind of sanctions that are called for now, not these quarter- measures that were just announced.

(END VIDEO CLIP)

VAUGHN: And, Neil, even some Democrats in the Senate also think that the majority of sanctions should be put on the table now, one of those, the chair of the Senate Foreign Relations Committee, Senator Bob Menendez, who said he wanted to see a lot of force up front.

But we did get off a call with senior administration officials moments ago, and the strategy from the White House, what they're insisting is that there are more sanctions to come as Putin escalates, so not to take these sanctions today as the only action that the president is willing to take, but just the first step that they are taking to respond to the first step that Putin has made -- Neil.

CAVUTO: All right, Hillary Vaughn, thank you very much for that.

To Kyiv, Ukraine, where you will find our Trey Yingst with the very latest, how all of this is going down.

Hey, Trey.

TREY YINGST, FOX NEWS FOREIGN CORRESPONDENT: Neil, good afternoon.

Today, Russian lawmakers voted to approve a request by President Putin to use military force abroad, the move raising new questions about whether or not Putin will decide that full-scale invasion into Ukraine.

We know, earlier, the Russian leader spoke extensively about the separatist-controlled areas of Eastern Ukraine that he chose to record last night, saying his decrees apply to the constitutional borders of these regions.

This is significant because it means that Putin is recognizing land that is currently controlled by Ukrainian forces.

(BEGIN VIDEO CLIP)

VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): As long as there is an ongoing conflict, by this decision, we are making it clear that, if necessary, we intend to stand by our obligations.

(END VIDEO CLIP)

YINGST: Overnight, military equipment started rolling through Donetsk and Luhansk shortly after the Russian leader signed the decrees recognizing the independence of these self-proclaimed breakaway republics.

This is being spun as a peacekeeping mission by the Russians. But make no mistake, this is a coordinated invasion into Ukrainian territory. Violence continues to erupt along the line of contact, with a power station taking a direct hit earlier today. Two more Ukrainian soldiers were killed overnight, as there's a real sense in the international community this could escalate to widespread ground operations on the European continent.

Listen to the NATO secretary-general.

(BEGIN VIDEO CLIP)

JENS STOLTENBERG, NATO SECRETARY-GENERAL: This is the most dangerous moment in European security for a generation.

QUESTION: People around the world and especially in Europe are now afraid of a full-on war. What do you think of that fear? And how far away are we?

STOLTENBERG: There is a real risk.

(END VIDEO CLIP)

YINGST: A bit of breaking news here.

We are learning Ukrainian President Volodymyr Zelensky has called up reserve forces in the country to prepare for the possibility of a much larger war -- Neil.

CAVUTO: Trey, thank you very much. Be safe.

Trey Yingst following all of that.

Well, the administration's position has been and echoed today sanctions, not soldiers, not soldiers in the Ukraine, but that doesn't mean soldiers outside Ukraine.

The very latest on that the Pentagon and our Jennifer Griffin -- Jennifer.

JENNIFER GRIFFIN, FOX NEWS NATIONAL SECURITY CORRESPONDENT: Thanks, Neil.

President Biden just announced he will be sending more U.S. troops already based in Europe to bolster NATO allies in the Baltics, Estonia, Lithuania, and Latvia. We now have the details. An infantry battalion task force of 800 personnel will move from Italy to the Baltics, eight F-35 Strike fighters from Germany to NATO's eastern flank, 20 Apache helicopters from Germany to the Baltics, and 12 Apaches from Greece to Poland.

They will not, as you said, be going to Ukraine, but Putin has mentioned Poland and Lithuania in some of his twisted retelling of history, and those are NATO Article 5 countries. Biden also announced sanctions to target Putin's cronies, oligarchs and their families to squeeze Putin. He said it's just the first tranche, suggesting Putin can avoid more if he reverses course and halts this invasion.

(BEGIN VIDEO CLIP)

BIDEN: We're implementing full blocking sanctions on two large Russian financial institutions, VEB and their military bank.

We're implementing comprehensive sanctions on Russian sovereign debt. That means we have cut off Russia's government from Western financing. It can no longer raise money from the West and cannot trade in its new debt on our markets or European markets either.

(END VIDEO CLIP)

GRIFFIN: U.S. officials remain clear-eyed that Putin has already taken a decision to invade, as evidenced by the Duma vote today allowing him to use Russian troops outside Russia.

The Ukrainian foreign minister arrived at the Pentagon today to meet with defense Secretary Lloyd Austin, an honor cordon to demonstrate unity.

(BEGIN VIDEO CLIP)

LLOYD AUSTIN, U.S. SECRETARY OF DEFENSE: As we meet today, Russia's latest invasion is threatening the peace and security and prosperity of Ukraine.

(END VIDEO CLIP)

GRIFFIN: That word invasion is significant. There is no more debate about minor incursions.

The U.S. and some NATO allies became aware of Putin's plans in October and began aggressively building a coalition. This video from December 27 shows Russian ultranationalist Vladimir Zhirinovsky addressing the Duma and spilling the beans on the time and date of an invasion.

(BEGIN VIDEO CLIP)

VLADIMIR ZHIRINOVSKY, RUSSIA LIBERAL DEMOCRATIC PARTY LEADER (through translator): At 4:00 a.m. on the 22nd of February, you will feel our new policy. I would like 2022 to be peaceful, but I love the truth.

For 70 years, I have said the truth. It won't be peaceful. It will be a year when Russia once again becomes great.

(END VIDEO CLIP)

GRIFFIN: We're now moving into a very dangerous phase, Neil.

CAVUTO: Yes, to put it mildly.

Jennifer, thank you for that, I think, Jennifer Griffin at the Pentagon.

Let's go to Lieutenant General Keith Kellogg, the former national security adviser to Vice President Mike Pence.

General, good to see you again.

And we're always meeting when, with every progressive chat, things get a little thornier and thornier, right?

GEN. KEITH KELLOGG (RET.), FORMER PENCE NATIONAL SECURITY ADVISER: Yes.

CAVUTO: I'm just curious what you make of Vladimir Putin's description of all of this, when he was saying earlier today that even the idea that troops are there, or seemed to hint at it, was a bit premature, that, right now, he's saying that we had said from the beginning troops will -- were not going to go there immediately.

So is he that there is no invasion or our troops unequivocally there from Russia?

KELLOGG: Yes, Neil, thanks for having me.

Look, don't listen to what Biden (sic) says. Look at his actions. I think, if you look at what he says, you're going to get misdirection. Look, there's clearly use of his forces into the separatist areas that you currently see in Eastern Ukraine. That's an invasion. Of course it is. And it's just like he did in Crimea. And I think he's just emboldened to keep going further. There's not much we can do about it.

We said earlier that Ukraine is not part of NATO. So Article 5 doesn't apply. I really wish, Neil, we could have rewound the clock, because there are some actions we could have taken six, nine months ago that would have changed this dynamic. But we're where we're at right now. It's sort of like it is what it is.

And I think we're heading into a new Cold War, because, clearly, Biden and Putin do not read off the same page. We have a very aggressive Putin. And I think he is going to continue to use forces to take, I still think, at least the eastern part of Ukraine.

President Biden said something that is really esoteric, but I picked up on it right away when he talked about movement of things by the Russians. He said he's moving whole blood. That made -- most people, that passed by. Whole blood only lasts for 42 days. You don't do that unless you mean to use it in your field hospitals.

That was kind of a tease that, OK, they have got -- they're onto something. They know what they're doing. We're reading the intelligence, and they're moving forces closer and closer to an assault.

So don't listen to what Putin is saying. Look at his actions, and they're not good.

CAVUTO: All right, you know now diplomatic-speak far better than I, General.

And a lot of people are reading in between the lines when Vladimir Putin seemed to be throwing a possibility out there that this is up to Ukraine to settle, and not Russia, when he said, the best decision that Ukraine could take would be to renounce its NATO membership ambitions.

KELLOGG: Yes.

CAVUTO: He went on to say that Ukraine should demilitarize, that it should go ahead and remove any talk of developing nuclear missiles that could target Russia.

So, is he, in a backhanded way, saying, Ukraine, you do all of these things, I don't invade? Or how do you interpret that?

KELLOGG: Yes.

Neil, that's a great observation, because that's what I mean about rewinding the clock. And if I say this, I'm sure I'm going to be contrarian. And I'm sure I'm going to get a Pavlovian response from a lot of people.

But we should have said that a long time ago. We should have said very definitively that Ukraine will not become part of NATO. And you looked at - - you point to Finland. President Niinisto just the other day is always on television and saying the same thing. Finland is an independent, sovereign country, borders Russia, not part of NATO. And yet they have been operating quite well with Russia for the last 80, 90, 100 years.

Maybe Ukraine should have done the same thing. The Pavlovian response is saying, oh, you're caving into Russia. Look, by not doing that, what you're looking at is an invasion of a sovereign country, in Ukraine, that may be occupied. So I think that was an out.

But, again, the reason I'm saying about the Pavlovian response, you say that in Washington, D.C., and people go absolutely nuts, but it's something they should have thought about really hard, because what you have got now is war. What you have got right now is the start of another Cold War.

And that's the consequence of those actions.

CAVUTO: General Kellogg, I respect the heck out of you. I so hope you're wrong. But it's very good catching up with you, sir. And thank you as well for your service to this country, General Keith Kellogg on that.

Now, right now, to Senator Ben Cardin, who sits on the Senate Foreign Relations Committee, the beautiful state of Maryland.

Senator, thank you very much for joining us.

The president's actions today that target financial interests in Russia, including, if you think about it, going after oligarchs and banks and that sort of stuff, much like Britain's on the sanctions, that's by design, isn't it?

SEN. BEN CARDIN (D-MD): Oh, absolutely.

Neil, first of all, it's good to be with you.

CAVUTO: Thank you.

CARDIN: These are very serious times. The type of sanctions President Biden is employing are meant not only to hurt the Russian economy generally, but to hurt the way in which Mr. Putin finances his operations, through his oligarchs.

So the banking systems, where they won't be able to do banking, the personal sanctions, all those are meant as a clear message to Mr. Putin that we're going to go as close as we possibly can to him in our sanctions.

CAVUTO: You know, it doesn't seem to be deterring him, Senator. And when you get these reports that he's even overruling his own -- well, his version of a cabinet and his own security council, they're shaking their heads. Like, he's doing this on his own.

So, any financial pressure on him, as one of the world's richest men, I'm sure a good deal of that dough is shoveled away in a place that we can't get at.

So, I'm beginning to wonder if these financial threats are just not registering.

CARDIN: Well, I think Mr. Putin had made a decision some time ago that he was going to invade Ukraine. I don't think the sanctions were -- would be enough to change his game plan.

However, when you hit his oligarchs in his network, it really does affect him and will weigh in on his decision-making going forward. So, these types of sanctions do have an impact.

Secondly, to the extent that it impacts on the Russian people itself, his popularity could be altered, as well as, we know, the cost of a war in regards to casualties. So, there's additional issues going into the calculations here. We know one person made this decision. That's Mr. Putin.

Our intelligence sources told us that was decided several weeks ago, when he started moving in the necessary troops and the support system. So, I acknowledge that sanctions were a long shot to -- the threat of sanctions were a long shot to stop him. We had to do every thing we possibly can.

But the sanctions will have a biting impact on him and will hurt him personally and certainly hurt his country.

CAVUTO: Well, it will hurt us too, though, won't this, Senator, if you think about it?

Oil prices are now in and out of better than decade highs. We have seen gas prices run up, heating oil, natural gas prices go up. How do you tell Americans that this response is worth it?

CARDIN: Well, you -- that's -- Neil, it's an excellent question.

If we said, OK, well let Mr. Putin take Ukraine, maybe next is China taking Taiwan. Then the whole security fabric of Europe can be jeopardized. We know that Lithuania, Latvia, and Estonia are very much in Mr. Putin's grasp. We could find the whole security network (AUDIO GAP) being challenged.

And that would have a far, far more detrimental impact on Americans. So we have to draw the line. We have to make it clear that we will not allow Mr. Putin to compromise sovereignty of other countries. If he does, there's a heavy price he has to pay. And, yes, we will pay a price, but nowhere near the price that Mr. Putin will pay or Russia will pay, and nowhere near as severe if we just let him continue to do this type of taking.

CAVUTO: You know, Senator, as you know better than I, oil is the currency for almost everything that Vladimir Putin wants to do.

His country is a huge manufacturer of oil. And, right now, that currency has gone up, good for him. And the argument goes that he will more than likely find enough willing customers, even in the black market, to pick up the oil that we prevent others from buying, and that China could be a customer, other countries could find a way of getting that oil.

If China does get that oil or gets a lot of that oil, should we punish them as well?

CARDIN: Well, first, Mr. Putin uses energy as a weapon. He always had.

That's why many of us were strongly opposed to Nord Stream 2. We're glad to see that's been put on hold by the Germans. That's an important step. That will financially hurt Russia, make no mistake about that. So we recognize that they're -- we're having an impact on his energy policy by our sanctions.

As far as secondary sanctions are concerned, they're a little bit more complicated and a little more difficult politically. I think we have to be very strategic in the manner in which we deal with other countries as it relates to what they do...

(CROSSTALK)

CAVUTO: But would you recommend that, Senator? It's clear. It's clear. You almost get a feeling that Vladimir Putin has checked with some allies and friends, the biggest of which is Xi Jinping in China, this oil that could be taken off the markets, there's plenty of it there for you.

And is that maybe explaining the bold, kind of in-your-face response Putin has had that, even though get oil that he is generating might be closed off to much of the Western world, he's got plenty of customers, and he doesn't think we're going to do anything about it and limiting their ability to buy it?

CARDIN: Well, I don't agree that he has plenty of customers.

But I do agree there are other customers that are available. China made pretty strong statements at the United Nations against what Mr. Putin was doing. I think, if we have unity among our Western partners, we need to sit down and talk to China about alternative sources of energy, so that we deal with the challenges presented by Russia's energy supplies being under sanction, and find alternative ways that we can help other countries deal with their energy needs, and not have to rely on Russia.

CAVUTO: So, back to Americans, Senator, if you will indulge me on the oil, the gas question.

The president has hinted about opening up the Strategic Petroleum Reserve even more to deal with these high prices. Do you believe that's warranted? And do you also think it might be a good idea to scrap the federal gasoline tax and, while Washington is at it, to implore states to do the same with their own state taxes to buffer this gas blow to American drivers?

CARDIN: Well, I think it may be too early to tell in regards to the Strategic Oil Reserve. That's there to make sure that we have adequate supply, but also we have stability in price.

So let's see what happens on energy prices. Let's see what we can do in using that Strategic Reserve. That's a tool we have. We should be prepared to use it. And I think President Biden will use it in order to stabilize not only the supply, but the price of oil here in the United States, and helping our allies do exactly the same.

The federal gasoline tax is an issue that's under consideration. We have to deal with real cost centers that are affecting Americans. As a result of COVID-19, to me, the most critical needs are to deal with supply chain issues and make sure we have adequate supply and deal with an adequate labor force here in the United States.

I think they have been the two major reasons we're seeing escalating costs. In regards to oil, let's wait to see what happens in regards to this conflict on oil prices.

CAVUTO: Well, obviously, this conflict has been lifting those prices and making that sprint a little bit more aggressive.

But, Senator, would you yourself be open to temporarily dropping the federal gasoline tax?

CARDIN: Well, Neil, I will take a look at it. I have concerns about making sure we have adequate resources to deal with America's transportation infrastructure. And, of course, those funds go directly for that.

There are different proposals out there on how we handle that particular issue. So I think we also need to look at not only the short-term funding for transportation, but also long-term funding for transportation.

So, I know there are better ways out there than a federal gasoline tax, and I hope we will have those conversations.

CAVUTO: All right, sir, I want to thank you very much for joining us, the Senate Foreign Relations Committee member Senator Ben Cardin, a Democrat from the state of Maryland.

So, that's a big thing to look at here. And, again, it could be explaining why and how Vladimir Putin would be economically hit very hard, as would his country. And you can see it in their stock market. It's fallen about a third since just October, big tumble today and this week. The Russian ruble, its currency, has been shellacked.

So he's suffering is financially in the markets as we are, maybe, some could argue, a lot more. So why is he behaving the way he's behaving?

Our Charlie Gasparino has been looking into this and how the Russian leader could be finding an end-run around a lot of this.

Charlie, what do you got?

CHARLIE GASPARINO, FOX NEWS SENIOR CORRESPONDENT: Well, I mean, listen, I got what I have from my Wall Street sources.

And, listen, everything the senator said about potentially selling to China, selling to alternative sources is out there. I will say this. Wall Street itself, when I talk to CEOs, and they know a lot about the interbank system, the way Russian oligarchs transact, how -- where -- they know a little bit about where Vladimir Putin keeps his money, which is probably under a mattress, and it's a lot of money.

They are not impressed by these sanctions, and they don't think this is going to go that far. And they don't think it's going to -- they don't think it's really going to have the impact on Russia, and that's -- that President Biden and Ben Cardin obviously pointed out before.

And one of the big problems, I think, that President Biden has, the Democratic Party is so wedded to zero carbon emissions immediately that we don't really drill here anymore. And we have -- we're essentially financing Vladimir Putin's war machine by keeping oil prices -- by suppressing the supply of oil on the market.

And I think that's a huge problem. And so no one's really impressed. Listen, you can go after oligarchs through the banking system, through the Treasury Department's anti-terrorist network, OK, make it difficult for them to buy Rolex watches, have three girlfriends in three different cities outside of Russia. That's an inconvenience.

But Vladimir Putin doesn't care. And the Russian economy has not taken -- listen, I know the stock market is off. Stock market is a predictor of the future, the Russian stock market. But have we seen a major recession in the Russian economy right now? No.

And what President Biden announced probably won't do it. I mean, the one thing they could do to really squeeze Russia is bar any Russian company, bar the country itself from engaging in the SWIFT system, that interbank system that allows people to transact in Russia with the U.S. and with cross-borders.

Unless they go there, I'm telling you, people -- I'm talking to CEOs. They're not...

CAVUTO: Well, they're not going there. They're not going there.

GASPARINO: They're not going there. They're not impressed by this.

CAVUTO: So, for Vladimir Putin, that's a relief. That's a big relief.

GASPARINO: And that's his -- and, by the way, that's his -- that's his out.

Unless they go there, I don't think he's going to care much. At least, that's what my sources are saying, CEO of -- CEOs of financial firms, that the oligarchs, they may -- that's an inconvenience. But the real pressure comes on -- comes if Russian rich people, if Vladimir Putin, if the country itself cannot finance its debt, cannot do any transactions whatsoever.

You only do that if you bar them from the SWIFT system. And they're not going there, Neil. And it's unfortunate.

CAVUTO: All right, that is a way for countries to get that exchange funds, money, currencies.

GASPARINO: Right.

CAVUTO: But let me ask you, stepping back from this, what if Vladimir Putin has gone rogue even in a country where he's the rogue, and he is going over the head of his top advisers, as we told, military, financial and otherwise, all his oligarch friends, all those who have been losing money hand over ruble fist in the Russian markets, and just doing this anyway, that he is so obsessed with this?

And we got a hint at it, referring back to the glory days he referred of the old Soviet Union -- that he's on his own here, that we have read this as a sort of Russian offense, but that he -- this is him, it's just him?

GASPARINO: Are we sure about that? The Russian people...

CAVUTO: I'm asking you.

I mean, if that is the case...

GASPARINO: I don't think that is the case.

CAVUTO: ... and he's ignoring these -- so you think this is a well- planned, widespread...

GASPARINO: No.

And I also think the Russian -- the Russian people, until these sanctions really get ratcheted up, where it puts the economy in a recession or a depression, they like the show of force. They like the old days. They like -- Stalin is still -- if you talk to a lot of Russians. I know a lot of Russians in New York. Stalin is still a revered figure because he was strong.

I am telling you that I think he's on politically strong ground, until -- until the -- until, like, real stiff sanctions through the SWIFT system imposes essentially a recession or depression on the Russian economy and until we raise the...

CAVUTO: All right, well, Charlie, let me -- I'm jumping on you, my friend, because I did want to get your final thoughts on this.

GASPARINO: OK.

CAVUTO: The market tanked again today.

GASPARINO: Right.

CAVUTO: S&P in correction territory, a fall of 10 percent or more, the Nasdaq very close to getting to bear market territory, a fall of 20 percent or more from highs. It's not quite there.

But my point being that the pain is being felt already among investors in this country, investors worldwide.

GASPARINO: Right.

CAVUTO: Vladimir Putin must know that.

GASPARINO: Of course he does.

CAVUTO: And are we prepared if this -- if an invasion ensues, and there's more of this to come, that we go into a deep bear market here?

GASPARINO: Are we prepared?

I mean, people been talking about this for a long time. I don't feel -- I don't know if the -- I think people will still buy in the market. And I think a lot of investors are unprepared. Think about -- put yourself in Vladimir Putin shoes right now. He sees a weak U.S. president, President Biden. He sees inflation coming in the U.S. He knows the Fed is going to raise rates.

And he knows we're not drilling. So oil prices are going to go up, which is inflation, in and of itself, if he does evade. He thinks he's got us boxed economically on this. And he thinks that our sanctions, we won't go nuclear on sanctions and throw him out of the SWIFT system.

This is his gambit. It's interesting. This is a war. There's tanks. There's -- people are going to die, but it's also an economic war as well. And he thinks he's got a game plan here. At least that's what my sources are telling me.

CAVUTO: All right, so you're going beyond just Russians who are congregating in New York City diners, right? I mean, but they're concerned.

GASPARINO: By the way, they -- well, there is a huge Russian...

CAVUTO: I'm kidding. I'm kidding.

GASPARINO: There is a huge Russian population here.

CAVUTO: Absolutely.

GASPARINO: And this is what they tell me.

CAVUTO: Very big.

GASPARINO: Just this is what they tell me.

CAVUTO: All right, thank you, my friend, very much, Charlie Gasparino following all of that.

All the major markets were down. There was some flight to quality in bonds today and the idea got to park our money somewhere, but very few people are finding alternatives. So they're just hanging on to whatever they have tightly.

We're still waiting to hear from Antony Blinken, the secretary of state. He's going to address the press with the Ukrainian foreign minister. So we're following that.

Also following this push on the part of the administration to go where the money is, and see if that might change Vladimir Putin's behavior. So far, it is safe to say it has not.

More after this.

(COMMERCIAL BREAK)

CAVUTO: All right, seconds away from a State Department briefing featuring Antony Blinken, the secretary of state, and one at the White House as well.

So much, so soon. So, be with us.

(COMMERCIAL BREAK)

CAVUTO: All right, moments away from hearing from Antony Blinken, the secretary of state, with the Ukrainian foreign minister.

Also, we're going to be getting a conference out of the White House soon after this.

In the meantime, this has spread concerns globally, including in Poland, who are on tenterhooks. Remember, they border to Ukraine.

Mike Tobin is in Arlamow (ph), Poland, with the latest from there.

Hey, Mike.

MIKE TOBIN, FOX NEWS CORRESPONDENT: Hey, Neil.

It may be hard to see the mountaintop airstrip behind me here. But it is currently host to some of the paratroopers with the 82nd Airborne. And it thus has the distinction of being the easternmost deployment of any NATO forces.

It's not much, what the paratroopers have been living here. They just got some -- living in here. They just got some heat in their tents. They have been surviving on MREs, meals ready to eat. And their primary mission right now is to stand by. Given the history of the 82nd Airborne, particularly in Europe, their mere presence is intended to send a message that the U.S. stands with its NATO allies, particularly in times of crisis.

And despite the rapid pace of developments recently, this could draw out for some time.

Kurt Volker, a former U.S. ambassador to NATO and special representative to the Ukraine, points out that Russia has been enjoying high gas prices. They have stockpiled things like cash, other resources. And despite the rapid pace, Putin and his army could weather this storm for some time.

(BEGIN VIDEO CLIP)

KURT VOLKER, FORMER U.S. SPECIAL REPRESENTATIVE FOR UKRAINE: He can ride this out for a long time. I think there is every possibility that he will launch a major invasion within days. All the forces are there. All the enablers are there. We know it's possible.

But, at the same time, he doesn't have to. He can keep trying to extract concessions from the West, from Ukraine. He can try to undermine Ukraine from within.

(END VIDEO CLIP)

TOBIN: Yes, we also caught up with U.S. forces in Mielec, Poland.

Their task is described as multimission capable. They can be adapted as needed. The U.S. forces already have been escorting embassy personnel between Poland and Lviv, Ukraine.

Also, in addition to the forces that were recently deployed, the U.S. is moving around resources that are already in Europe. They're moving a battalion of infantry from Italy to the Balkans, as many as eight F-35 Joint Strike Fighters are moving here to NATO's eastern flank.

And a task force as of as many as 12 Apache attack helicopters are being moved from Greece here to Poland. But, in the meantime, for the forces that were recently deployed, particularly those here with the 82nd Airborne at this particular base in Arlamow, their job is to stand by and try to stay warm on this cold mountaintop -- Neil.

CAVUTO: All right, you too there, Mike. Thank you very much, Mike Tobin in Poland on all those developments.

Obviously, they have more than a slightly vested interest in what's going on in neighboring Ukraine.

Phil Flynn saying the whole world is watching what's going on down there. As we have been discussing, oil, energy prices have been skyrocket.

I just wonder, Phil Flynn, who joins me now, what you want to hear out of the secretary of state and the foreign minister of Ukraine when they start speaking.

PHIL FLYNN, FOX BUSINESS CONTRIBUTOR: I think I want them to basically give a hard line to Vladimir Putin and to say stop, cease, and go the other way.

But I'm afraid it's too late. The sanctions that are going into place right now suspiciously can't be on the energy complex, because, let's face it, Europe can't supply themselves with energy. We can't get them enough energy. So if the supplies are cut off, they're really out of luck.

And, yes, they took the right step today by canceling or at least slowing down the Nord Stream 2 pipeline, but that's a pipeline that should have never been built. And at the end of the day, it's the U.S. consumers that are going to feel the pain of this as well, because we're already seeing the prices of natural gas in Europe hit record highs.

That's going to get over to this side of the pond. And that means you and I are going to be paying the price for this conflict.

CAVUTO: You know these oil markets so well, Phil. And I always had the feeling sanctioned countries, when let's say they're oil producers, like we went after Gadhafi and all of that in the old years with Libya, they find ways of getting their oil out to customers, don't they?

FLYNN: It's amazing.

They find these little things in this little market, and all of a sudden people will buy it if you sell a cheap enough. That's exactly what's happened to Iran. The Biden administration has been all over trying to get back into a nuclear deal with Iran and lift the sanctions. And while that will bring more oil to the market, Iran has been doing pretty darn well selling black market oil to places like China.

And they're bringing in a lot of cash. And I think it's another sign that the Biden administration doesn't really get the global energy space. What's happening in the Ukraine and in Russia is in a large part about domineering Europe and controlling their energy supply.

And I think what we're seeing here from -- you just had a great interview with Senator Ron (sic) Cardin, and he made a statement that I think shows that they don't really get what's going on. He said that they should use a Strategic Petroleum Reserve to stabilize the price of oil.

That's not why we have a Strategic Petroleum Reserve, because you can't stabilize the price of oil with so little oil. So, if they want to try to stabilize the price of oil, we're going to have to build a much larger reserve. And we had one, the U.S. energy producer. That's what stabilized the market, not the small Strategic Petroleum Reserve.

It's there for -- in case of emergency, and I'm afraid right now we're heading towards an emergency.

CAVUTO: I am curious, though, what you make of if Russian oil were off the market, largely off the market. I know black market and all that.

We ourselves in this country get a lot of Russian oil. And I'm just wondering, between that oil being off the market and still very strong demand in this country for oil, because underlying is a very strong economy we have got going on here, so the demand is there. The supply could be dramatically cut. That's usually a recipe for still higher prices.

What do you think?

FLYNN: Absolutely.

And what worries me more is a potential price shock. Over the last couple of years, Neil, we killed the Keystone pipeline, which would have brought oil down from Canada. We have put sanctions on Venezuela, which was probably deservedly so. But it has left us more dependent than ever on Russian oil supply. The type of oil that Russia produces, U.S. refiners need it.

And if it gets cut off, it's not easily replaced. So that's going to show up immediately at the gas pump. Listen, the risk to -- of an oil price shock is the biggest it's been since the 1970s. Global supplies can't keep up with demand right now. And that's why Vladimir Putin is acting now. He sees President Biden not being able to do anything about this.

So, he can roll on, control energy prices and push his will around the entire world.

CAVUTO: Yes, he could be calculating that, that the pain at the pump will be enough for -- to give an American president pause. We shall see.

Phil Flynn, thank you.

FLYNN: Thank you.

CAVUTO: So why is there a Putin acting the way he is and sort of being the rogue that a lot of people but he was, but not so much to go in the face of his own Security Council and others, who are advising maybe cool it a little bit?

Claudia Rosett is the former Wall Street Journal Moscow bureau chief, Independent Women's Forum.

Claudia, I want to get into Vladimir Putin's mind. I know it's a scary place. But you know him well. You know his past well. You know his rise to power well. He's risking a lot of financial hurt, not only for himself, although I suspect he's got a lot of money tapped in places, but for his own people. Why is he doing this?

CLAUDIA ROSETT, FOREIGN POLICY FELLOW, INDEPENDENT WOMEN'S FORUM: He's a man on a mission, Neil.

And he said it yesterday, basically. He's been saying it for years, signaling it. He is -- his mission is to reassemble a Russian empire, not as a communist system, but as an empire with which Vladimir Putin is the czar, the ruler.

And he's -- he's a KGB-trained -- he was a foreign intelligence officer with the KGB. He's a smart man. He has had years to prepare this, sort this out. He has -- as you were just talking with your previous guest, he's saved up more than $600 billion in reserves. He's got it diversified in useful ways.

Our sanctions that we just -- the President Biden just put on are not actually going to do much of anything to him. It might hurt his people. But he's willing to make all sorts of tradeoffs in the interest of this mission. And that's exactly what you're seeing.

He likes this. I think he's actually enjoying this, if you watched him last night at the Kremlin.

CAVUTO: Well, it was interesting as well when he was speaking and sort of jawboning about this.

But we might get an idea now from Antony Blinken, the secretary of state, and the Ukrainian foreign minister about what options are still out there.

The secretary of state.

ANTONY BLINKEN, U.S. SECRETARY OF STATE: Foreign Minister Kuleba and I were in Munich just a few days ago.

Russia's aggression toward Ukraine and its rejection of international law and diplomacy have accelerated. Yesterday, President Putin recognized the so-called independence of the Donetsk and Luhansk regions of Ukraine, where violent Russian-backed separatists have been fighting a war since 2014. A few hours later, he gave authorization to Russian troops to enter those regions.

For weeks, we have been warning the world that Russia was mobilizing for military aggression against Ukraine. We have made clear that, if Russia invaded, the United States and our allies and partners would impose swift and severe consequences.

Now that Russia has moved against Ukraine, so too have we moved on our strong and unified response. This afternoon, the president announced the first round of sanctions on Russia in response to its actions. These have been closely coordinated with our allies and partners. We will continue to escalate our sanctions if Russia escalates its aggression toward Ukraine.

Today, we're implementing full blocking sanctions on two large Russian financial institutions, VEB and Promsvyazbank, both of which have close links to the Kremlin and the Russian military.

Collectively, they hold more than $80 billion in assets. These measures will freeze their assets in the United States, prohibit American individuals or businesses from doing any transactions with them, shut them out of the global financial system, and foreclose access to the U.S. dollar.

We're expanding our existing sanctions on Russian sovereign debt. We have already prohibited U.S. financial institutions from trading in Russian sovereign debt in the primary market. Now we're extending that prohibition to the secondary market. These prohibitions will cut off the Russian government from a key avenue by which it raises capital to fund its priorities and will increase future financing costs.

They also deny Russia access to key U.S. markets and investors. Starting today, we will impose sanctions on members of the Russian elite and their family members, all of whom directly benefit from their connections with the Kremlin. Other Russian elites and their family members are on notice that additional actions could be taken against them.

These steps are in addition to the executive order President Biden issued yesterday to prohibit new investment, trade and financing by Americans to, from and in the so-called DNR and LNR regions.

And, just as the president said we would do, today, the Department of Defense announced that we would be sending additional forces to NATO's eastern flank to deter and defend against any Russian aggression directed at our allies.

We also made clear that, if Russia invaded Ukraine, we would act with Germany to ensure that the Nord Stream 2 pipeline does not move forward. Today, Chancellor Scholz announced that the German government is suspending that pipeline indefinitely. We have been in close consultation with Germany throughout this process. We welcome the swift and decisive action.

And we're executing a plan, in close coordination with allies and partners, to secure the stability of global energy supplies, which is in all of our interests.

The United States and our allies and partners are united in the face of Russian aggression. This morning, the European Union and the United Kingdom announced a series of strong complementary actions.

President Putin's deeply disturbing speech yesterday and his statements today make clear to the world how he views Ukraine, not as a sovereign nation with the right to territorial integrity and independence, but, rather, as a creation of Russia, and, therefore, subordinate to Russia.

It's a completely false assertion that ignores history, international law, and the tens of millions of patriotic Ukrainians who are proud citizens of a free and independent Ukraine. Now that we have heard it directly from President Putin himself, it confirms what we have been saying, that he did not send more than 150,000 troops to the Ukrainian border because of benign military exercises, or to respond to threatened aggression from Ukraine, or to stop a fabricated genocide by Ukraine, or any other manufactured reason.

His plan all along has been to invade Ukraine, to control Ukraine and its people, to destroy Ukraine's democracy, which offers a stark contrast to the autocracy that he leads, to reclaim Ukraine as a part of Russia.

That's why this is the greatest threat to security in Europe since World War II. Ukraine is in danger. President Putin is blatantly and violently breaking the laws and principles that have kept the peace across Europe and around the world for decades.

Yesterday, at an emergency session of the U.N. Security Council requested by Ukraine, the United States and many other countries condemned Russia's renewed attack on Ukraine's sovereignty and territorial integrity as a violation of international law and the United Nations Charter.

U.S. Ambassador Linda Thomas-Greenfield underscored that President Putin has now torn to shreds the Minsk Agreements, which sought to end the conflict in the Donbass region of Ukraine peacefully, through diplomacy. President Putin himself essentially declared those agreements null and void.

The complete abdication of Russia's commitments under the Minsk Agreements is just the latest demonstration of Russia's hypocrisy when it comes to the agreements that it claims to seek and to uphold. Since the beginning of this Russian-manufactured crisis, Moscow has insisted that only legally binding agreements could satisfy its security concerns.

But the Minsk Agreements now join a long line of agreements, many legally binding, that President Putin has broken. These include the Helsinki Final Act, in which all OSCE countries, including Russia, pledged to respect national sovereignty and territorial integrity and refrain from the threat of the use of force, the Charter of Paris, which further established countries' responsibilities to honor those pledges, the Conventional Armed Forces in Europe Treaty, which limits the deployment of military equipment in Europe.

The Vienna Document, in which all OSCE countries, including Russia, agreed to confidence and security-building measures to increase transparency and predictability about their military activities. And, of course, the Budapest Memorandum, in which Russia promised to respect Ukraine's independence and sovereignty in its 1994 borders, and refrain from using force against Ukraine.

In the past 24 hours along, with his actions toward Ukraine, President Putin has violated all of these agreements. He is undoing more than 30 years' worth of painstaking diplomacy by Russia and the countries and institutions of Europe and the North Atlantic region to preserve stability and security, for the sake of hundreds of millions of our citizens.

Every time Russia breaks one of these agreements, it not only endangers the countries that it's threatening at the time, but nations everywhere that have been made safer and more secure by the international rules-based order.

Last week, I agreed to meet Russian Foreign Minister Sergey Lavrov this week on February 24 to discuss our countries' respective concerns about European security, but only if Russia did not invade Ukraine. Now that we see the invasion is beginning, and Russia has made clear its wholesale rejection of diplomacy, it does not make sense to go forward with that meeting at this time.

I consulted with our allies and partners. All agreed. And, today I sent Foreign Minister Lavrov a letter informing him of this.

The United States and I personally remain committed to diplomacy if Russia is prepared to take demonstrable steps to provide the international community with any degree of confidence that it's serious about de- escalating and finding a diplomatic solution.

We will proceed in coordination with allies and partners based on Russia's actions and the facts on the ground. But we will not allow Russia to claim the pretense of diplomacy at the same time it accelerates its march down the path of conflict and war.

There is no question what has happened here. We have all seen how Russia has relentlessly mobilized for war, despite intensive efforts by others, including the United States, to engage them on a diplomatic path. We have seen through their false flags. We have predicted there lies.

In the hours and days ahead, any further escalatory steps by Russia will be met with further swift and severe measures, coordinated with allies and partners, on top of those announced today.

We will continue to stand with our allies and partners to support Ukraine, as it faces Russia's threats, with courage and strength. And we will continue to defend the international laws that keep every country in the world safe from the kind of aggression that Russia is now inflicting upon Ukraine.

Dmytro.

DMYTRO KULEBA, UKRAINIAN MINISTER OF FOREIGN AFFAIRS: I'm grateful to Secretary Blinken for welcoming me in D.C. today.

We -- I think we spoke -- this is our third our fourth encounter in the last four days. And this speaks for the dynamics and the quality of our relationship, but also for the urgency of the current crisis that needs to be handled.

We meet at a very tense and responsible time for Ukraine, for the United States, and for the world. We all are at a critical juncture for the security of Europe, as well as international peace and security more broadly.

Russian aggression has brought the world to the edge of the largest catastrophe since World War II. Yesterday, President Putin moved to recognize two pieces of Ukrainian land as independent entities. Ukraine does not and will never recognize this absurdity. Neither will the world recognize it.

In fact, what Putin recognized is not the so-called Donetsk People Republic and Luhansk People Republic. He recognized his direct responsibility for the war against Ukraine, and an unprovoked and unjustified war on another sovereign state in Europe, which Russia now intensifies.

President Putin killed Minsk Agreements. And, more broadly, he attacked the world order. Needless to say, Russia's move is a grave breach of international law and a new act of aggression against Ukraine's sovereignty and territorial integrity.

Therefore, Ukraine strongly believes that the time for sanctions is now. And, in this context, we welcome today's announcement of sanctions by President Biden. The world must respond with all its economic might to punish Russia for the crimes it has already committed, and ahead of the crimes it plans to commit.Hit Russia's economy now, and hit it hard.

I commend immense efforts of the U.S. diplomacy led by Tony to mobilize the global coalition of allies and partners to stop Russia. The entire world stands today with Ukraine, and rightly so.

Putin wants much more than a war-torn piece of Ukrainian land and people living there. What stops him is only our unity and resolve. And we can still stop him.

Ukraine continues the engagement with the United States, E.U. and NATO in diplomatic efforts to ease tensions. Yet we also stand ready for any possible development. We had a focused discussion today with Secretary Blinken on steps to protect Ukraine and our multidimensional resilience.

One of the proposals that we put forward today is designing a program similar to the lend-lease implemented during the World War II to support the war efforts of the Allies in eastern -- in east -- in Europe. This program will help to ensure sustainable -- sustainability and will improve efficiency in the -- in strengthening the capacity of Ukraine to defend itself.

The last point that I would like to make, today, we discussed some very specific ideas. And we appreciated very concrete steps made by the United States. These days, we receive proposals from some countries to condemn Russia's behavior, to condemn, but not follow the condemnation with action.

And I would like to say that condemnations are important, but it's actions that really matter now, these days. And I'm grateful to our strategic partner the United States for its ironclad support, including military, economic, and political, diplomatic assistance provided to Ukraine.

The Ukrainian people will surely remember the United States standing with Ukraine at this decisive moment in history. Thank you.

NED PRICE, STATE DEPARTMENT SPOKESMAN: We will now turn to questions.

And we will take two from each delegation.

We will start with Vivian Salama of The Wall Street Journal.

QUESTION: Thank you very much.

Mr. Secretary, President Biden said three days ago that, if Russia invades, they will have chosen war and the door to diplomacy will be closed. Today, however, he seemed to have left the door open for diplomacy, despite labeling what Russia has done as an invasion.

And so, even though you have now canceled your meeting with Minister Lavrov, can you say what the circumstances would entail to justify talks at this point, absent, say, a full withdrawal? Does the actions in Donbass kind of open the door for potential negotiations?

And, on that point, if you would both indulge me with two questions, President Putin today also said that the crisis could be resolved if Kyiv promised to abandon future efforts to join NATO. And so that's been a nonstarter for the West. So what needs to happen, then, for any of these talks to actually be entertained?

Minister Kuleba, good to see you again.

A question -- quick questions for you. Does the Ukrainian government have any plans to evacuate Mariupol or Kharkiv in the coming days, just given the events that we're -- we have seen in Donbass?

And, secondly, the United States has informed the United Nations of a credible -- of credible information showing that Moscow has compiled a list of Ukrainians to be killed or sent to camps following a military occupation.

Were you informed of this list? Your government, was it informed of this list? And have any actions been taken to respond to it?

Thank you.

BLINKEN: Thank you. I'm happy to start.

First, the further renewed Russian invasion of Ukraine that has now begun means clearly that the idea of having a meeting this week with Foreign Minister Lavrov to pursue diplomacy, diplomacy now rejected by Russia, does not make sense.

But, having said that, to the extent there's anything that we can do to avert an even worst-case scenario, an all-out assault on all of Ukraine, including its capital, that would inflict horrific costs on the Ukrainian people, we will always pursue that.

So, we, our partners remain open to diplomacy, but Moscow needs to demonstrate that it's serious. The last 24 hours, it's demonstrated just the opposite. It hasn't been serious to date, including with regard to the meeting that was planned for Thursday.

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