THE SANCTIONS against Russia that President Obama announced Thursday were far tougher than those previously taken in response to the invasion and annexation of Crimea. But they remained carefully calibrated: Mr. Obama aimed to inflict economic pain on Vladi­mir Putin and his inner circle of financiers and cronies, not on the Russian economy as a whole. Mr. Putin was not named, but his personal banker and bank were locked out of the U.S. financial system, as were key aides and several longtime friends who have become billionaires under his regime and who may handle some of his investments.

The U.S. strategy could have the advantage of punishing Mr. Putin while minimizing the collateral damage to the U.S., European and global economies that could come from a broader economic war. At the same time, Mr. Obama sought to deter further Russian aggression by granting authority for sanctions against Russian economic sectors, including the energy industry, and making clear that they would be imposed if other parts of Ukraine were attacked.

Mr. Obama should get credit for leading the Western response to Mr. Putin: Burdened by the need to establish consensus among 28 governments and with larger domestic equities at stake, the European Union has not been as aggressive in targeting the Putin circle. But the U.S. sanctions still fall far short of what is needed to inflict the “massive” damage to the Russian economy threatened by German Chancellor Angela Merkel, much less force a retreat from Crimea.

The test now will be whether Mr. Putin ceases what has been a steady escalation since Russian troops fanned out in Crimea nearly three weeks ago. On Thursday the outlook was not good: Moscow not only sanctioned several U.S. politicians and White House officials but it also imposed what U.S. officials said appeared to be a trade embargo with Ukraine. Mr. Obama expressed “grave concern” about Russian troop movements that could presage a move into southern and eastern Ukraine. Mr. Putin is still refusing to recognize the Ukrainian government in Kiev and appears bent on bringing about its downfall.

The administration has declined to provide military aid to the Ukrainian army, irking some critics. But even with such assistance, Ukrainian forces would be unable to stop a Russian invasion; the economic tools at the West’s disposal have more potential punch. Mr. Putin and his political elite appear drunk with euphoria over their successful seizure of Crimea and skeptical about the West’s will to push back. If the latest sanctions do not quickly sober them up, Mr. Obama must not hesitate to expand the range of sanctions from Mr. Putin’s inner circle to the pillars of the Russian economy.