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21 Mar, 2022 11:00

EU considering Russian oil embargo – report

The full ban would be part of an expanded package of sanctions against Moscow
EU considering Russian oil embargo – report

EU ministers are set discuss a ban on Russian oil as part of the fifth package of sanctions, in an effort to force Moscow to abandon its military operation in Ukraine, Reuters reported on Monday.

“It’s unavoidable we start talking about the energy sector, and we can definitely talk about oil because it is the biggest revenue to Russia’s budget,” Reuters quotes Lithuanian Foreign Minister Gabrielius Landsbergis as having said. The new sanctions will also reportedly add more names of Russian individuals to EU blacklists.

EU foreign and defense ministers are expected to debate the matter on Monday, ahead of the arrival of US President Joe Biden in Brussels on Thursday for talks with NATO’s 30 allies, the EU, and the Group of Seven (G7) including Japan.

Last week the EU banned its member-states’ companies from investing in the Russian energy sector but fell short of banning oil and gas imports from the country. The EU gets roughly 40% of its natural gas from Russia, and more than half of the country’s oil exports are destined for Europe.

Reuters reports that Baltic countries including Lithuania are pushing for an oil embargo as the next logical step in putting pressure on Moscow, while Germany, the largest EU buyer of Russian crude, is urging caution because energy prices in Europe are already skyrocketing.

Another EU nation, Bulgaria, has said it might seek an opt-out, according to Reuters, as the country’s only oil refinery is owned by Russia’s LUKOIL and provides over 60% of the nation’s fuel.

Meanwhile, Moscow has warned of ‘serious’ consequences an embargo of Russian oil will have on Europe. Speaking to media on Monday, Kremlin spokesperson Dmitry Peskov said such a ban would “have a serious and negative impact on the energy balance on the European continent.” The US will not be affected as much as the EU, he added, but the people in Europe “will find it really hard. Such a decision will affect everyone,” Peskov said.

Russia has indicated that it can sell its energy products elsewhere if its Western buyers pull out. India, the world’s third-largest energy consumer, bought several million barrels of Russian crude last week, to be delivered in May. The Organization of the Petroleum Exporting Countries (OPEC) warned last week of an upcoming shock in the world’s oil markets if some buyers shun Russian crude.

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