For several days, rumors had been swirling. The United States finally put an end to it on Tuesday March 8 by formalizing the embargo on American imports of Russian oil and gas on the thirteenth day of the Russian offensive in Ukraine. “This is regarding increasing the sanctions imposed on Russia and dealing a powerful new blow to Putin,” said President Joe Biden, adding that the decision had been taken “in close coordination” with the country’s allies. The United Kingdom also announced, on the same day, its decision to stop imports of Russian crude oil and petroleum products by the end of the year.
Except that for the rest, this coordination marks its limits for the moment. For several days, the United States had been pressuring European states to follow suit. Without much result. This is because Russian imports provide 40% of the European Union’s natural gas needs and 30% for oil, with great diversity between countries. Some of them, like Latvia or the Czech Republic, are 100% dependent on Russian gas. Germany is also largely supplied with Russian hydrocarbons.
Joe Biden also insisted on not loading the boat with his European allies. “We are working closely with Europe and our partners to put in place a long-term strategy to reduce their dependence on Russian energy,” he added. The American president knows that this embargo will not have the same consequences in his country as in Europe.
The markets had already anticipated the decision
Because the United States are net exporters of energy, ie they produce more than they consume, thanks in particular to oil and shale gas. The country even became the first oil-producing country in 2017. And Russian black gold now represents only 8% of American imports. “And once more, underlines the framework of a large group specialized in energy, this oil is important only for questions of costs and logistics. It is often cheaper for them to bring it from abroad to their ports than to transport it via pipelines across the country. Significant leeway therefore exists. »
In the UK, the situation is similar. The country derives half of its gas supply from domestic sources, although reserves are plummeting. It imports a good part of the rest of Norway and Qatar. Regarding oil, it uses its North Sea deposits, even if, there too, they are in decline. In total, only 8% of British consumption depends on Russian oil, and 4% on gas. The British oil giant Shell also announced its intention to withdraw from these two Russian resources “gradually, to align with the new directives of the British government”. BP had for its part announced at the end of February its disengagement from the Russian giant Rosneft, of which it held 19.75%.
And the consequences for France and the rest of Europe? “They were already observable even before the official announcement of the embargo, continues this same expert. The buyers, who anticipated this radical decision, turned away from Russian hydrocarbons, for fear of no longer being able to sell their stocks. Hence the rise in prices on the markets for several days, these same buyers being forced to source their supplies elsewhere, and often for more. An analysis shared by Kwasi Kwarteng, the British Minister for Energy, who observed on Twitter that “70% of Russian oil was already currently unable to find a buyer”. After peaking at more than 140 dollars (regarding 128 euros) a barrel of Brent, the market also seems to have calmed down a bit. This Tuesday evening, it was displayed at 127 dollars.
