EU compromises on Russian oil ban, but clashes with Austria and Germany over gas
Austria and Germany have ruled out any future European Union embargo on Russian gas imports after a Brussels summit agreed a partial oil ban last night.
Poland, Estonia, Latvia and Lithuania are already pushing to step up Russian energy sanctions to keep the pressure on President Putin, but other EU countries said the bloc had hit the political limit.
Setting the scene for a new clash over sanctions, Karl Nehammer, the Austrian chancellor, said that there could be no question of suspending gas imports because of the effect on major European economies, such as Germany’s.
“The gas embargo will not be a topic, Olaf Scholz has made this clear as well,” he said, in a reference to the German chancellor ruling out any moves towards a ban during talks last night. “Russian oil is much easier to compensate for, gas is completely different, which is why a gas embargo will not be an issue in the next sanctions package.”
EU leaders managed to maintain unity over sanctions last night but gave Hungary and other landlocked central European countries exemptions allowing pipeline oil imports for an indefinite period.
Kaja Kallas, the Estonian prime minister, said the deal was a “compromise” that had prevented the EU from deadlock, but the new seventh sanctions round would be more difficult.
“I think gas has to be in the seventh package,” she said. “Gas is much more difficult than oil already was. All the next sanctions will be more difficult because so far they have only hurt Russians but now they are also having effects on Europeans.”
Krisjanis Karins, the Latvian prime minister, urged “immediate and full energy sanctions” including gas. “The stronger the sanctions, the quicker the war will end,” he said.
Alexander De Croo, the Belgian prime minister, said the EU had reached its political limits on Russian energy sanctions and that future measures would be on controlling prices and phasing out imports. “In my view, this is the end of the road, especially in the area of sanctions in the field of energy.”
President Macron of France said “ambiguity” over any future gas ban provided leverage against Russia. “I think nothing should be ruled out because nobody can tell how things will evolve, how the war will evolve,” he said. “We have to keep credibility and this strategic ambiguity is also useful.”
Viktor Orban, the Hungarian prime minister, declared a “victory” with a carve-out on the EU oil ban during tense talks in Brussels, which allow his country to continue getting supplies via the Russian Druzhba pipeline for an indefinite period.
Hungary is dependent on the pipeline from Siberia for 65 per cent of its oil, which is used to make petroleum and diesel for itself and neighbouring countries.
“It would have been like a nuclear bomb [for the Hungarian economy] but we successfully avoided this,” Orban said.
No time limit has been set on the exemption but Hungary, Slovakia, Czech Republic, Bulgaria and others will not be able to sell on petroleum products made from Russian oil across the wider EU after eight months to stop market distortions
Under other exemptions for Greece, Cyprus and Malta, Russian oil can continue to be shipped across the world.
The partial ban will mean a loss of some €7 billion a month in revenues for Russia, but the income could be replaced by soaring local prices for oil and customers in Asia.
Ukraine is highly critical of the compromise on oil and the EU’s reluctance to confront Germany and Austria over gas imports. “Far too slow, far too late and definitely not enough,” Ihor Zhovkva, an aide to President Zelensky, said this morning.
