European stock indices are trading mixed on Tuesday, with investors assessing the possibility of new sanctions against Moscow, which could lead to a rise in commodity prices and fuel concerns about inflation.

By 03:40 a.m. ET (07:40 GMT), Germany’s DAX index was trading 0.4 percent higher, France’s CAC 40 was up 0.1 percent and Britain’s FTSE 100 was down 0.1 percent.

The U.S. and Europe plan to impose new sanctions against Moscow.

On Monday, the U.S. barred the Russian government from paying sovereign debt holders more than $600 million from reserves held in U.S. banks, but the main move for the European Union and Germany in particular will be a ban on Russian oil and gas imports.

Germany is heavily dependent on Russia for energy, and getting it to agree to this would face political difficulties given the economic consequences.

German banks already expect economic growth to slow sharply by about 2% this year because of the situation in Ukraine, as Christian Seving, chief executive of Deutsche Bank (DE:DBKGn) and president of German banking lobby BDB, said on Monday.

“The situation would be even worse if imports or supplies of Russian oil and natural gas were stopped. In that case, a significant recession in Germany would be almost inevitable,” Seving said.

Oil prices are trading higher on Tuesday, helped by the prospect of new sanctions on Russia, adding to the strong gains seen in the previous session.

By 03:40 a.m. ET (08:40 GMT), WTI futures were trading 0.8 percent higher at $104.12 a barrel, while the Brent contract rose 0.8 percent to $108.43. Both contracts were up more than 3% on Monday.

European economic data on Tuesday includes a series of March manufacturing and services PMI releases from the region, while French industrial production fell 0.9% in February, a sharp decline from a revised 1.8% rise in January.

In terms of corporate news, Go-Ahead Group shares rose 4.4% after the British transportation operator said it will reinstate its pre-COVID-19 dividend policy this year and also unveil plans to expand its operations.

In addition, gold futures fell 0.3% to $1928.40 an ounce, while EUR/USD rose 0.1% to 1.0984.