While the United States is discussing with the European Union to ban imports of Russian oil and Washington is ready to act alone in the event of refusal by European countries, many of which depend heavily on energy imports from Russia, Moscow has warned Monday once morest “catastrophic consequences for the world market” of the establishment of such an embargo. According to the Russian Deputy Prime Minister, in charge of Energy, Alexander Novak, “the surge in prices is likely to be unpredictable and to reach more than 300 dollars for a barrel, or even more”, he said, cited by Russian news agencies.
For the latter, it is impossible to quickly replace deliveries of Russian oil to the European market with those from an alternative source.
“It will take several years and it will be much more expensive for European consumers who will be the main victims of such a scenario,” he warned.
The price of a barrel of Brent from the North Sea came close to 140 dollars on Sunday around 11:00 p.m. GMT, close to its absolute record of July 2008 when it had approached 150 dollars.
An oil priced at 300 dollars would cause prices at the pump to jump to more than 3 euros per liter for SP95. Indeed, in Le Parisien, Francis Pousse, the president of fuel distributors (excluding supermarkets) at Mobillans, the trade union for distribution and automotive services, explains that “a dollar increase in the barrel leads to between 0.7 cents and 1 euro cent increase at the pump”. Already, with a barrel at 250 dollars (230 euros), the liter of SP95 would almost reach the bar of 3 euros (2.87 euros).
Russian reprisals: freezing gas deliveries
“Concerned” by the discussions around an oil embargo, Russia might also take retaliatory measures on the gas supply to Europe, of which nearly 40% of imports come from Russia (55% for Germany). While Germany last month suspended the certification process for the Nord Stream 2 gas pipeline to link it to Russia, Moscow warned that it might freeze deliveries via Nord Stream 1. “We have the right to make a decision similar and to impose an embargo on gas arrivals via the Nord Stream 1 gas pipeline”, declared Alexandre Novak. This gas pipeline which carries Russian gas to Europe is currently “100%” full.
“But we have not taken such a decision for the moment (…). Although European politicians are pushing us to do this with their statements and accusations,” underlined Alexander Novak.
Discussion between Americans and Europeans
In the United States, US President Joe Biden, who is under intense political pressure to cut off this essential source of revenue for Russia, “has not made a decision at this stage” on a possible gas embargo and Russian oil, spokeswoman Jen Psaki said Monday. Putting the differences between the United States and Europe into perspective, she indicated that the subject had been raised on Monday during a conversation between the American president and the German, French and British leaders. Jen Psaki in particular insisted heavily on “the very different circumstances” for the Americans and the Europeans in terms of Russian hydrocarbons. Indeed, regarding 30% of Europe’s oil needs are provided by Russia, once morest only 8% for the United States. The White House is indeed very concerned not to crack more than necessary the almost perfect cohesion shown so far by the West in terms of economic sanctions once morest Russia.
According to Washington, the United States, France, Germany and the United Kingdom are “determined to continue to increase the cost” inflicted on Russia in response to the invasion of Ukraine, according to a press release published by the White House. The French statement evokes him “their determination to strengthen the sanctions” once morest Russia and Belarus, while that of the British promises to “continue to put pressure on Russia”. Only the press release published by Berlin does not address the question of sanctions at all, insisting above all on the “new possibilities of humanitarian aid for Ukraine” which were also discussed. On Monday, Olaf Scholz said that fossil fuel imports from Russia were “essential” for the “daily life of citizens” in Europe, and assured that the supply of the continent might not be ensured otherwise at this stage. .
The EU wants to eliminate its dependence on Russia
However, European Union leaders will agree this week to phase out the union’s dependence on Russian gas, oil and coal imports, a draft statement seen by Archyde.com on Monday shows. Leaders of EU countries will meet for a summit in Versailles on Thursday and Friday to discuss strengthening the Union’s common defense capability and the possibility of Ukraine becoming a member of the EU .
They will also discuss ways to make the EU strategically independent from global suppliers in key sectors such as microchips, health and food.
“We have agreed to gradually reduce our dependence on Russian gas, oil and coal imports,” the leaders’ draft statement reads.
The EU will achieve this “notably by diversifying its supplies and routes, including through the use of liquefied natural gas (LNG) and the development of biogas and hydrogen” and “by accelerating the development of renewable energies and the production of their main components, as well as streamlining permitting procedures for energy projects,” the project says.
It also mentions the improvement of the interconnection of Europe’s gas and electricity networks and the complete synchronization of its electricity networks, as well as the strengthening of the EU’s emergency plans for the security of supply.
(With AFP and Archyde.com)
