Europe talks about joining Russian oil embargo

In a series of meetings starting Monday, EU leaders will discuss whether to dump the region’s biggest oil supplier, which has already pledged to cut Russian natural gas use by 66 % This year.

“We need to discuss how we can support Ukraine even more, politically, economically, with humanitarian aid, in terms of security, everything is on the table. So we can make sure that we will do everything we can. to stop Putin and his aggression against Ukraine,” Danish Foreign Minister Jeppe Kofod told reporters. “It is important with economic sanctions to continue on this path.”

Russia is the world’s second largest oil exporter, behind Saudi Arabia, and despite the chilling effect of a Western financial sanctions and an embargo announced by the United States and the United Kingdom, it continues to earn hundreds of millions of dollars a day from energy exports.

“I think it’s inevitable to start talking about the energy sector. And we can definitely talk about oil, because it’s the biggest income in the Russian budget,” Lithuanian Foreign Minister Gabrielius said. Landsbergis, upon his arrival in Brussels for a meeting with his EU counterparts.

Other EU states back the idea of ​​hitting Russia’s most valuable asset with sanctions.

“Looking at the scale of the destruction in Ukraine right now, it’s very difficult – in my opinion – to argue that we shouldn’t get into the energy sector, especially oil and coal, in terms of interrupting normal commerce in this space,” Irish Foreign Minister Simon Coveney said.

The European Union currently depends on Russia for around 40% of its natural gas. Russia also provides about 27% of oil imports and 46% of coal imports.

What will Germany do?

Earlier this month, EU leaders said the bloc could not yet join the United States in banning Russian oil, due to the impact it would have on households and industries already struggling with record prices. Instead, they said they would work towards a 2027 deadline to end the bloc’s reliance on Russian energy.

There is also a risk that Russia could retaliate by restricting natural gas exports. Deputy Prime Minister Alexander Novak said this month that Moscow could cut gas supplies to Germany via the Nord Stream 1 gas pipeline in retaliation for Berlin blocking the new Nord Stream 2 gas pipeline project.

Yet political opinion could harden in Europe as Russia steps up its attacks on Ukrainian cities, killing hundreds of civilians and forcing millions to flee their homes.

Much will depend on countries like Germany, Russia’s biggest energy customer in Europe, as well as others that buy much of its gas, such as Hungary and Italy.

German Foreign Minister Annalena Baerbock said the country was “working at full speed” to end its dependence on Russia but, like some other EU countries, could not stand still. stop buying Russian oil overnight.

“If we could, we would automatically,” she said.

According to the International Energy Agency, even without an EU embargo – and without a potential counterforce from Russia – the world is facing its biggest energy supply shock in decades. He said last week that Russia could be forced to cut crude oil production by 30% from next month due to falling demand.

Canada, the United States, the United Kingdom and Australia have already banned imports of Russian oil, affecting about 13% of Russian exports. And the moves by major oil companies and global banks to stop doing business with Moscow after the invasion are forcing Russia to offer its crude at a huge discount.

The Paris-based IEA, which monitors energy supplies to the world’s major developed economies, said Russian production could fall by 3 million barrels a day.

“The implications of a potential loss of Russian oil exports to world markets cannot be underestimated,” the IEA said in its monthly report.

Mary I. Bruner