One of the people said the sanctions would probably be announced on Friday and were being crafted to be “as mild as possible” to placate Congress while avoiding serious damage to the extensive US-Turkey military relationship.
News of the move comes as the Senate is due to vote on a defence appropriation bill that would require the Trump administration to impose sanctions on Turkey within 30 days of the final vote as punishment for Ankara’s decision to buy the system.
President Donald Trump has threatened to veto the legislation — for reasons unrelated to the sanctions — but it is expected to pass the Senate with a veto-proof majority, as it did in the House of Representatives.
The first person familiar with the plans said the Trump administration wanted to “pre-empt” the measures contained in the defence bill. The language of the act makes it difficult to lift the sanctions once imposed.
A former government official said sanctions were “coming soon”, although they added that opinions were “mixed” on how severe they would be.
Ankara’s announcement that it had tested the S-400 system on the Black Sea coast in October has complicated efforts to avoid confrontation over the issue, which has already seen the US suspend Turkey from the F-35 fighter jet programme. Washington last year cancelled the delivery of Ankara’s order for more than 100 of the fifth-generation aircraft.
The decision underlines the increasingly troubled relationship between Turkey, a longstanding Nato member, and its traditional allies in the west.
President Recep Tayyip Erdogan has in recent years intensified his drive to pursue an independent foreign policy unconstrained by the demands of the US or Europe. But his close co-operation with Russia and military interventions in Syria, Libya and the Caucasus — combined with concerns about a crackdown on domestic opponents — have fuelled mounting alarm in Washington and in European capitals.
Navigating the relationship with Ankara, which is viewed even by many US critics as a strategically important nation in a tumultuous region, is one of the foreign policy challenges that Joe Biden will inherit when he takes over as president next year.
Turkey’s purchase of the S-400 system in 2019 should have triggered sanctions — under the Countering America’s Adversaries through Sanctions Act, or Caatsa — against nations that engage in “significant transactions” with the Russian defence industry or intelligence sector.
But Mr Trump, who boasts of his personal rapport with Mr Erdogan, has shielded Turkey from the requirement. Caatsa sanctions could include banning individuals and institutions involved in the S-400 purchases from transacting with US banks.
Reuters news agency first reported that the US sanctions were imminent, saying the measures would target Ismail Demir, the head of the Turkey’s Presidency of Defence Industries, known as SSB, who reports directly to Mr Erdogan and was responsible for procuring the S-400 system.
Harsh sanctions could decimate the fragile Turkish economy. The Turkish lira has fallen about 24 per cent against the dollar this year amid investor concern at the country’s economic policies and plummeting central bank reserves.
But measures that narrowly target Mr Demir and the SSB would be likely to have a limited immediate effect on the Turkish economy and could be met with relief from foreign investors who have fretted about the prospect of more damaging measures.
A state department spokesperson said it did “not preview sanctions or possible sanctions”.