NEW YORK (MainStreet) — Sanctions are making it harder for U.S. companies to do business in Russia and for foreign companies to use U.S. sourced products and equipment in their Russian operations, according to experts.

““This will benefit our competitors by making their products and services more attractive by default," said Andrew Carrillo, president with Barnett Capital Advisors, a wealth management firm in Miami.

In an attempt to increase political pressure on Russia for its treatment of Ukraine, the U.S. government is targeting Russian individuals and companies with direct prohibitions and disallowing the export of certain goods and services from the United States.

And it’s working.

“Reports indicate that no Russian companies were extended loans from U.S. or European financial institutions in July, which is the first such credit drought in recent years,” said Andrew Melsheimer, attorney with the international energy practice group with Thompson & Knight in Dallas.

Companies limited in their ability to raise capital with new bonds or equity that mature in more than 30 days include Russia’s largest bank Sberbank, a Russian producer of battle tanks called Uralvagonzavod and a Russian aerospace company called Oboronprom.

“Sanctions create more incentive to begin trading without the dollar, because that's the best way to get out from under the sanctions,” Carrillo told MainStreet. “We’re pushing the world’s second largest natural gas and oil producer away from the dollar, which is not smart.”

Russia has reportedly already begun trading commodities with China in rubles and yuan.

“The sanctions themselves may not affect Americans directly however the results of losing the reserve currency due to the sanctions will,” said Carrillo.

Over the past decade, economic sanctions have become a centerpiece of U.S. national security policy.

“This means that Americans and companies doing business inside Russia or with Russians need to conduct more diligence than before in their transactions,” Melsheimer told MainStreet. “If they are not asking questions about their counterparties, including who owns Russian companies, those U.S. persons and companies may risk violating these sanctions.”

International partners impacted include Royal Dutch Shell, Norway’s Statoil and Exxon Mobil.

“The E.U. and U.S. are now cutting off any source of international capital that would fund exploration of oil and shale reserves in Arctic Shelf,” said Pran Tiku, author of The Emerging Markets Handbook: An Analysis of the Investment Potential in 18 Key Emerging Market Economies (Harriman House, 2014).

Exxon’s partnership with the Russian firm Rosneft to drill in the Arctic is on hold due to sanctions after Exxon invested $3.2 billion to have access to billions of barrels of oil.

As a result, American manufacturers and suppliers are at risk of losing an important consumer of products and services, such as the highly specialized equipment needed to develop Russia’s emerging energy resources in the Arctic and West Siberia.

“U.S.-sourced products and equipment are heavily used in Russia, because Russia itself has not dedicated time, money or research into developing technologies to aid in drilling,” Tiku told MainStreet. “They import all the technologies they need from the west.”

--Written by Juliette Fairley for MainStreet