Brussels has proposed a phased ban on all Russian oil imports as EU member states try to negotiate a sixth package of sanctions against Moscow for its invasion of Ukraine.
The ban will cover all Russian oil, offshore and pipeline, crude and refined, European Commission President Ursula von der Leyen said on Wednesday. She promised to phase out supplies in an “orderly” manner, reaching crude oil within six months and refined products by the end of the year.
The commission is also proposing that Sberbank, Russia’s largest bank, be excluded from the international banking payment system Swift, von der Leyen told the European Parliament. Two other banks, Credit Bank of Moscow and Russian Agricultural Bank, will be excluded from Swift, according to draft proposals seen by the Financial Times.
Hungary and Slovakia are relying heavily on Russian oil and will have until the end of 2023 to comply with the import ban, according to the commission’s draft plans.
The measures, which will have to win the support of all 27 member states, mark the latest escalation of Western sanctions designed to undermine the Kremlin’s ability to wage war against Ukraine by hitting the backbone of the Russian economy.
Recommended
Russia earns more revenue from the sale of oil and oil products than from gas exports, but the commission is trying to follow a thin line to avoid too high an oil price and inadvertently generate even more revenue for President Vladimir Putin.
Brent crude rose 2.5 percent on Wednesday to $ 107.58 a barrel after news of the EU’s move surfaced. The EU hopes that the phasing-in of the oil embargo by the end of the year will create additional time for Member States to secure alternative supplies and re-equip refineries to use different types of crude oil.
“With the latest measures,” we are maximizing pressure on Russia while minimizing collateral damage to us and our partners around the world, “von der Leyen said in Strasbourg. “To help Ukraine, our own economy must remain strong.
Von der Leyen also said the EU would extend its ban on Russian broadcasters it accuses of misinformation. She did not name them, but the draft document is called “Russia RTR / RTR Planeta”, “Russia 24” / Russia 24 and TV Center International.
“They will no longer be allowed to distribute their content in the European Union, in any form or form, whether by cable, satellite, the Internet or smartphone applications,” von der Leyen said in Strasbourg.
The draft sanctions also propose restrictions on the provision of audit services.
EU diplomats are due to begin discussing the measures on Wednesday, with oil measures being the most sensitive part of the package.
As an early sign of Hungary’s continued resistance, government spokesman Zoltan Kovacs warned that Budapest had seen “no plan or guarantee” on how to manage the transition from Russian oil to the current proposals.
Kovac added that it was unclear how Hungary’s energy security would be guaranteed.
The momentum behind the oil ban has risen in recent weeks as Germany has indicated it is making progress in phasing out its own dependence on oil. However, much greater opposition remains to the idea of banning Russian gas due to its critical role in the energy mix in several Member States, including Germany.
As the EU prepares to discuss the package, the Ukrainian president said on Tuesday that “we must all insist that it includes an oil embargo and a real blockade of all schemes that Russia uses to deceive the free world and ignore sanctions.”
“Russian banks must be completely excluded from the global financial system,” Vladimir Zelenski added in a video address to the Albanian parliament.
In response to the EU’s move, Oleg Ustenko, Zelenki’s chief economic adviser, said Ukrainians had “watched with disbelief as our EU partners continued to buy Russian fossil fuels by financing 1 billion euros in war crimes in our country.” every day. He added: “Now we are finally seeing action,” but noted that “huge quantities” of Russian oil and gas are still traded around the world.
Additional reports by Neil Hume
Add Comment