BRUSSELS (Parliament Politics Magazine) – Leaders of the European Union have come to an agreement on a proposal to stop over two-thirds of oil imports of Russia.
Following Hungary’s resistance, the prohibition will only apply to oil arriving by sea, not pipeline oil.
The agreement, according to European Council chief Charles Michel, cut off a major source of funding for Russia’s war machine.
It’s part of a six-pack of sanctions authorised during a summit in Brussels, which required unanimous approval from all 27 EU member states.
Russia presently provides the EU with 27% of its imported oil and 40% of its gas. In exchange, the EU pays Russia roughly €400 billion ($430 billion, £341 billion) per year.
No sanctions have been imposed on Russian gas shipments to the EU so far, though plans to build a new gas pipeline connecting Russia and Germany have been halted.
What are the contents of the EU’s sixth round of sanctions?
- By the year end, Russian seaborne oil will be banned, with a brief exemption for pipeline oil. The sea transports two-thirds of Russian oil.
- Germany and Poland have agreed to stop buying pipeline oil by the end of the year, bringing the ban’s coverage to 90 percent of Russian imports.
- Sberbank, largest bank of Russia, will be cut out from the Swift payment system, which enables for quick money transfers across borders.
- In addition, three broadcasters owned by Russia are banned.
- People responsible for crimes of war in Ukraine are hit with more restrictions.
Members of the EU spent hours trying to work out their disagreements over the Russian oil import restriction. The primary opponent was Hungary, which gets 65 percent of its oil from Russia via pipelines. Viktor Orban, the country’s prime minister, maintains cordial relations with Russian President Vladimir Putin.
Mr Michel told reporters that the compromise came after weeks of debate until it was decided on a temporary exemption for oil that arrives through pipelines to the EU.
As a result, the immediate sanctions will only affect Russian oil being delivered into the EU by sea, which accounts for two-thirds of all Russian oil imports.
However, Ursula von der Leyen, President of the European Commission stated that the ban’s reach would be widened in practise because Poland and Germany have agreed to wind down their own imports via pipelines by the year end.
What was left was about 10% to 11% that was covered by the southern Druzhba, Ms Von der Leyen added, referring to the Russian pipeline that supplies oil to the Czech Republic, Hungary and Slovakia. She said that the European Council would reconsider the exception as soon as feasible.
The news of the EU embargo boosted oil prices, pushing Brent crude above $122 a barrel which is its highest level since March.
The European Commission, which sets regulations for member states, suggested the restriction on Russian oil imports a month ago.
However, reluctance from Hungary, in particular, has stalled the EU’s newest wave of sanctions.
Mr. Orban hailed the agreement as a success for Hungary, assuring Hungarians that they should rest easy knowing that they would be safeguarded from high fuel prices that the ban was sure to bring to Europe.
They had defeated the European Council’s plan that would have prohibited Hungary from utilising Russian oil, he declared in a Facebook video.
Due to their reliance on Russian oil, other landlocked nations such as the Czech Republic and Slovakia have also requested extra time. Bulgaria, which had already been shut off from Russian gas by Gazprom, had sought opt-outs as well.
The European-wide cost-of-living problem hasn’t helped matters either. High energy prices, among other things, have stifled some EU members’ willingness to impose sanctions that could harm the economies of their own countries.
