With Ukraine under siege, Biden announces new trade sanctions to 'squeeze' Russia

Stepping up the economic pressure on Russian President Vladimir Putin as he continues to attack Ukraine, President Joe Biden announced Friday that in conjunction with other G-7 nations and the European Union, the U.S. will move to revoke "most favored nation" trade status for Russia.

"As Putin continues his merciless assault, the United States and allies and partners continue to work in lockstep to ramp up the economic pressures on Putin and to further isolate Russia in the global stage," Biden said from the White House. "Revoking PNTR (permanent normal trade relations) for Russia is gonna make it harder for Russia to do business with the United States."

The move to strip Russia of its favored nation status would allow the U.S. and others to impose tariffs on a wide range of Russian goods.

Biden also announced the U.S. is banning the export of luxury goods to Russia as well as banning imports of certain goods from Russia, including seafood, vodka and diamonds. He also said the G-7 is adding new names to the list of targeted oligarchs it was sanctioning.

"Putin is an aggressor -- is the aggressor, and Putin must pay the price. He cannot pursue a war that threatens the very foundation to which he's doing -- the very foundations of international peace and stability and then ask for financial help from the international community," Biden said. He added that the U.S. will speak to the G-7 about Russia's ability to borrow the from the International Monetary Fund and the World Bank.

Additionally, Biden said he spoke with Ukrainian President Volodymyr Zelenskyy Friday morning ahead of his remarks, and "told him -- as I have each and every time I've spoken to him -- that the United States stands with Ukraine as they bravely fight to defend their country."

While each country will have to suspend normalized trade relations on their own, the announcement is another example of Western unity against Putin as nations tighten the squeeze on Russia. It follows the U.S. imposing an immediate ban on Russian oil and other energy imports earlier this week.

Over the past two weeks, Russia has widened its attacks on major cities across Ukraine. The United Nations said Thursday that at least 549 civilians, 41 of whom were children, have died since Russia's invasion began. At least 2.5 million have already fled the country.

"Most of the civilian casualties recorded were caused by the use of explosive weapons with a wide impact area, including shelling from heavy artillery and multi-launch rocket systems, and missile and airstrikes," the office said.

As the threat of Russia taking over Kyiv and overthrowing Zelenskyy looms, the 40-mile Russian military convoy that was last seen northwest of Kyiv has repositioned around the capital city, appearing to take attackable positions.

"We remind Russian authorities that directing attacks against civilians and civilian objects as well as so-called bombardment in towns and villages and other forms of indiscriminate attacks are prohibited under international law and may amount to war crimes," said the U.N. High Commissioner for Human Rights spokesperson Elizabeth Throssell on Friday.

But Russia has doubled down, instead, on its false claims that the U.S. and Ukraine are developing chemical or biological weapons for use against invading Russian forces. Russia is expected to bring the false accusation to the United Nations Security Council on Friday -- one day after a senior U.S. defense official warned that the U.S. has seen "indications" of Russia using a potential false flag operation biochemical weapons as a pretext for the potential use of "these kinds of agents in an attack."

Asked about the accusation Friday, Biden said he wouldn't comment on intelligence but warned Russia not to make such a move.

"Your White House has said that Russia may use chemical weapons, or create a false flag operation to use them," a reporter said. "What evidence have you seen showing that, and would the U.S. have a military response if Putin would launch a chemical attack?"

"I'm not going to speak about intelligence but – but – but Russia would pay a severe price if they used chemical weapons," he replied.

Moments earlier, Biden reiterated his position that "we will not fight a war against Russia in Ukraine."

"We'll defend every single inch of the NATO territory with the full might of the united and galvanized NATO," Biden said, but adding, "Direct confrontation between NATO and Russia is World War III, something we must strive to prevent."

As the situation on-the-ground escalates, Republican senators have urged the Biden administration to send Ukraine 29 MiG fighter jets Poland offered to provide to Ukraine – but only if the U.S. transports them, which the Pentagon has not agreed to.

"Enough talk. People are dying. Send them the planes that they need," Sen. Mitt Romney, R-Utah, said at a press conference Thursday. Ukraine, meanwhile, has pleaded with NATO, unsuccessfully, to enforce a no-fly zone over the country.

In response to claims that Russia may view the transfer of MiGs as escalatory on behalf of the U.S., the GOP group scoffed, saying it was time for the U.S. to project strength in this conflict and have Putin fear the U.S. for a change.

Vice President Kamala Harris, making stops across Europe to address the crisis, said Thursday that the administration is inching closer to acknowledging war crimes by Russia, saying "Absolutely there should be an investigation and we should all be watching," while White House press secretary Jen Psaki said the U.S. must go through "the legal assessment and review to make a formal conclusion."

Biden also noted the $13.6 billion in assistance for Ukraine included in the government funding bill passed Thursday night, which he said he looked forward to signing "immediately."

ABC News' Luis Martinez, Conor Finnegan, Molly Nagle, Justin Gomez and Allison Pecorin contributed to this report.