The EU has agreed to ban around 75% of Russian oil imports.
The embargo covers Russian oil brought in by sea, but has a temporary exception for imports delivered by pipeline to appease Hungary and other countries concerned about the economic impact of a full ban.
Hungary gets more than 60% of its oil from Russia and relies on crude that comes from the Soviet-era Druzhba (“Friendship”) pipeline.
Charles Michel, the president of the European Council, said: “We want to revert to the European Council as soon as possible in order to address this temporary exception and to make sure that we will be able to target all the Russian oil.”
He said 75% of Russian oil imports to the EU would be immediately banned, rising to 90% by the end of the year.
The sixth EU sanctions package since the invasion of Ukraine will also cut off Russia’s biggest bank, Sberbank, from SWIFT, the global system for financial transfers from which the bloc previously banned several smaller Russian banks.
Three more Russian state-owned broadcasters will be banned from distributing their content in the EU.
“We want to stop Russia’s war machine,” Mr Michel said, calling the measures a “remarkable achievement”.
“More than ever it’s important to show that we are able to be strong, that we are able to be firm, that we are able to be tough.”
Emmanuel Macron, the French president, hailed the move, saying: “As Europeans, united and in solidarity with the Ukrainian people, we are taking new decisive sanctions.”
Volodymyr Zelenskyy, the Ukrainian president, was less enthusiastic, saying it had taken too long to agree new sanctions in Europe. He pointed out that the last package was introduced nearly two months ago.
In an address to the Ukrainian people, he said he was grateful to Mr Michel for “trying to find the necessary compromises” to make the measures possible, adding: “Russia must feel a much higher price for its aggression.
“The key point is, of course, the oil. I believe that Europe will have to give up Russian oil and oil products in any case.
“Because this is about the independence of Europeans themselves from Russian energy weapons.
“And the sooner this happens, the more complete the abandonment of Russian oil will be, the greater the benefit will be for Europe itself in the end.”
The new sanctions will be legally endorsed by Wednesday, Mr Michel said.
Mikhail Ulyanov, Russia’s permanent representative to international organisations in Vienna, responded to the EU’s decision on Twitter, saying: “Russia will find other importers.”
The measures had been announced on 4 May but were held up by objections from countries including Hungary, Slovakia, the Czech Republic and Bulgaria.
The initial aim had been to phase out imports of crude oil within six months and refined products by the end of the year.