EU Has Plan

This post is for all my friends in Europe that their countries depend on Russian oil and gas.

By now most Europeans have heard the ban of Russian oil and gas….and I would imagine the question on their minds is …..how will we cope with this loss of resource?

Well the EU has a plan to help out with this situation……

Some 25% of all oil imports to the EU came from Russia last year. European Commission President Ursula von der Leyen is ready to take that figure down to zero. Von der Leyen on Wednesday proposed a total ban on Russian imports to the EU as part of a sixth package of sanctions, under which crude oil would be banned within six months and refined products by year’s end. What you need to know:

  • Context: Most of the oil the EU gets from Russia is used for gasoline and diesel for vehicles (14% of the EU’s diesel comes from Russia), reports the AP. That could make trucking even more expensive. This proposal doesn’t touch natural gas, which is used to heat homes and generate electricity. The EU gets about 40% of its natural gas from Russia, and alternatives are tougher to find.
  • Von der Leyen’s standout lines: “Let us be clear: it will not be easy. Some member states are strongly dependent on Russian oil. But we simply have to work on it. We now propose a ban on Russian oil. This will be a complete import ban on all Russian oil, seaborne and pipeline, crude and refined,” she said, per the Guardian.

Next steps: The Wall Street Journal reports all 27 member states will need to give the proposal the OK. A decision is being sought within the week.

The asterisk: Under the proposal, Slovakia and Hungary would get an extra year to wean themselves fully off of Russian oil due to their current dependence on it. But the BBC reports Slovakia’s economy minister is seeking a three-year period to do so, and the New York Times quotes Hungary’s foreign minister as saying, “It is physically impossible to operate Hungary and the Hungarian economy without crude oil from Russia.”

Oil prices: Predictably, they jumped. Prices were up more than 3% on the news. The Journal notes it’s unlikely that every barrel the EU were to refuse would find a home elsewhere, meaning the global supply could shrink.

Yellen’s concern: The Journal points out that US Treasury Secretary Janet Yellen in early April pointed out the likelihood that a full ban could cause prices to soar; that could soften the blow of the lost EU revenue and lessen the impact of the sanctions on Russia.

That EU revenue. The Guardian cites calculations by NGO Europe Beyond Coal, which estimates the EU has paid roughly $22 billion to Russia for oil since the start of the invasion.

My question for my European visitors….does this plan solve anything?  Is it a sound plan?  Or is it a band-aid?

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8 thoughts on “EU Has Plan

  1. What Russia has done is put the entire world at risk…for what purpose? We are in one of the worst moments in history – a crippling worldwide pandemic and the looming threat of a nuclear war for no reason…

  2. johnreiber wrote, “What Russia has done is put the entire world at risk…for what purpose? We are in one of the worst moments in history – a crippling worldwide pandemic and the looming threat of a nuclear war for no reason…

    I could not have stated that any better. Absolutely the truth. With the impending absence of Putin, if the unconfirmed reports of abdominal cancer and Parkinson’s Disease are true, the man slated to take over is another evil KGB spy. He is the one that convinced Putin that neo-nazis were in Kyiv. We know what we have with Putin, but this supposed replacement is far worse than Putin truly. Putin actually did not even follow his own Russian Constitution. He was to have the power over to his Prime Minister, but because he has been friends with this guy for years (probably in the KGB together) he appointed him as his replacement.

    If you missed it I wrote about it here if you should be interested.

    1. There will come a point when the well will run dry and Ukraine will have to do it with what they have…..as Pete stated Russia may well wear Ukraine down…..chuq

  3. The UK is no longer in the EU, but does import quite a lot of diesel and kerosene from Russia. When it was declared that those imports would stop completely, the prices of petrol, diesel, and heating oil (kerosene) jumped alarmingly, in some cases doubling. As a result, Shell and BP have just decared their biggest 3-monthly profits in the history of both companies. (In the tens of billions since the Russian invasion)
    Yet there has been no solid confirmation that the UK has actually stopped importing diesel from Russia, albeit through third party countries that bought on our behalf.
    A coincidence then that the big oil companies have record profits? I think not.
    Best wishes, Pete.

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