BERLIN (Reuters) - The European Union should punish Russian President Vladimir Putin for the arrest of Kremlin critic Alexei Navalny and thousands of his supporters with targeted financial sanctions, the leader of the bloc’s largest political alliance said on Sunday. Police detained more than 3,000 people and used force to break up rallies across Russia on Saturday in support of Navalny, who was arrested last weekend as he returned to Russia from Germany for the first time since being poisoned with a nerve agent. “It’s unacceptable that the Russian leadership is trying to make short work of the burgeoning protests by arresting thousands of demonstrators,” Manfred Weber, a senior German conservative and head of the centre-right EPP grouping in the EU Parliament, told Germany’s RND newspaper group. “The EU foreign ministers are not allowed to dodge this once again and stop at general appeals,” Weber said. “The EU has to hit where it really hurts the Putin system - and that’s the money,” Weber said. The EU should therefore cut financial transactions from Putin’s inner circle, he added. In addition, a threat to stop the Nord Stream 2 pipeline, which is meant to double natural gas deliveries from Russia to Germany, must remain on the table, Weber added. A German government spokeswoman declined to comment when asked whether Berlin was willing to support new sanctions against Russia following Navalny’s arrest. EU lawmakers passed a resolution on Thursday calling for the bloc to stop the completion of the Nord Stream 2 gas pipeline as a response to Navalny’s arrest. German Chancellor Angela Merkel, who has continued to back the project despite criticism elsewhere in the EU, said on Thursday her view of the project had not changed despite the Navalny case. The United States, EU and Britain have all condemned the Russian security forces’ handling of Saturday’s protests, and the foreign ministers of France and Italy on Sunday both expressed support for sanctions.