EU finally embargoes Russian oil

From The Guardian

The European Union has agreed to a partial embargo on Russian oil after late-night talks at a summit in Brussels.

Volodymyr Zelenskiy had earlier appealed to EU leaders to show unity against Vladimir Putin, as the bloc edges towards a watered-down embargo of Russian oil.

At a summit in Brussels, EU leaders had been attempting to find a way to placate the Hungarian prime minister, Viktor Orbán, who has been holding up a deal on the latest sanctions against Putin’s war machine.

Under a compromise plan that was discussed at the summit, Russian oil transported through the Soviet-era Druzhba pipeline for Hungary, the Czech Republic and Slovakia would be exempt from the EU embargo.

The president of the European Council, Charles Michel, tweeted on Monday night that the deal “immediately covers more than two-thirds of oil imports from Russia, cutting a huge source of financing for its war machine”.

He added that the package also included removing access to Swift payments for Russia’s largest bank, Sberbank; banning three more Russian state-owned broadcasters; and further sanctions against “individuals responsible for war crimes in Ukraine”.

Ursula von der Leyen, the president of the European Commission, said the bloc had agreed a “massive investment in renewable energy” in order to compensate for the diversifying away from Russian oil.

The EU had stalled over its latest sanctions against Russia for nearly four weeks since the Von der Leyen, proposed a complete ban on Russian oil by the end of the year.

Arriving at the summit, Orbán said “the pipeline solution is not bad” but insisted his country needed guarantees it could get oil from other sources if there was an “accident” at the Druzhba pipeline, which runs through war-torn Ukraine. In typically pugnacious style, Orbán attacked the commission for what he called its “irresponsible behaviour” and blamed it for creating a “difficult situation”.

The bloc has come under increasing criticism for slow progress in agreeing the latest sanctions package, the sixth, including from Zelenskiy, who addressed the gathering on Monday by video link.

Ukraine’s president called on leaders to end their disputes, which “only encourage Russia to put more pressure on you”, according to an extract of his speech published on Telegram.

The German chancellor, Olaf Scholz, said earlier he was confident there was a “good solution” on the oil embargo. Germany, along with Poland, has pledged to phase out Russian oil by the end of the year. Officials close to the talks say the decision of these two large economies to forgo oil from the northern leg of the Druzhba pipeline means the EU oil embargo would cover 93% of Russian oil supply by the end of the year.

As yet there is no end date on the exemption for the southern leg of Druzhba, covering Hungary, Slovakia and the Czech Republic, landlocked countries that are heavily dependent on Russian oil.

Latvia’s prime minister, Krišjānis Kariņš, said he intended to warn his fellow leaders not to get “bogged down” in details. “The big picture is that we have to starve Russia, Moscow, of the funds to continue the war,” he said. “If each European country only thinks about itself then we will never move forward.”

 

Source: Research Gate

So the 2/3rds cut is immediate, but by end-year, with Poland and Germany imposing their own bans, it will reach 93%.  Oil and gas make up most of Russia's exports.  This embargo will lead to the Russian economy collapsing.