ROUNDUP 4: EU forges compromise on oil boycott against Russia – and gas?

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BRSSEL (dpa-AFX) – After weeks of discussions, the EU countries have agreed on an extensive boycott of oil deliveries from Russia. However, the agreement reached at a summit in Brussels reveals that, after three months, the EU is finding it increasingly difficult to react with one voice to the Russian war against Ukraine. The heads of state and government of the 27 states continued to strive for unity. Hungary’s Prime Minister Viktor Orban could only be persuaded to agree to the embargo plans through significant concessions.

The import of Russian oil by ship is now to be banned after the compromise reached on Tuesday night – but that will probably only take effect in a few months. However, overland pipeline oil deliveries remain permitted. Orban had argued that his country could not do without Russian oil by the end of the year for economic reasons. Neighbors Slovakia and the Czech Republic joined.

After weeks of a blockade policy, Orban was also promised money from EU pots for the conversion of his country’s oil infrastructure. In the event of sudden delivery problems, he should also be allowed to obtain oil by tanker despite embargoes.

Federal Economics Minister Robert Habeck (Greens) expressed his outrage at the right-wing populist’s negotiating tactics. Orban gambled “ruthlessly”. Europe’s strength and determination suffered from the “choke”. Chancellor Olaf Scholz had previously spoken positively in Brussels and spoke of drastic sanctions against Russia.

The German course in sanctions policy is also controversial. The federal government has been repeatedly accused by Ukraine, but also by EU states such as Lithuania and Poland, of rejecting European plans for a gas boycott against Russia for selfish motives.

The federal government is aiming to become largely independent of Russian gas by summer 2024. Germany fears an economic crisis if imports are stopped too quickly. It was unclear whether the decision to introduce an oil embargo would further increase the already high energy prices. Experts had recently made it clear that this can hardly be estimated at present. Germany only wants to import oil from Russia this year anyway.

It is also unclear how badly Russia will actually be hit by the partial embargo, which will not be implemented until the end of the year at the earliest. EU foreign affairs commissioner Josep Borrell conceded that Moscow would not necessarily export less oil. “We cannot stop Russia from selling its oil to someone else.” We’re not that powerful.” But the EU was Russia’s most important customer. “They will have to look for others, and they will certainly have to lower prices.”

According to estimates by the EU think tank Bruegel, until recently, EU countries spent around 450 million euros a day on oil from Russia and 400 million euros on gas. According to Von der Leyen, EU oil imports from Russia will be reduced by around 90 percent by the end of the year, despite the exemption for pipeline deliveries. The reason for this is that Poland, like Germany, does not want to benefit from the exception for pipeline oil.

Like Hungary, the Czech Republic and Slovakia, both countries are connected to the only pipeline coming from Russia, “Druzhba” (“Friendship”). In Germany, the “Druschba” has so far supplied the large East German refineries in Schwedt and Leuna. So far, a third of Russian oil imports have come via the Druzhba. Two thirds are transported by sea.

Details of the boycott agreement are to be worked out by the permanent representatives of the EU in Brussels on Wednesday. The sanctions package could then be formally approved. With the embargo, additional sanctions against Russia would come into force. Among other things, the sixth sanctions package provides for the exclusion of the largest Russian bank Sberbank from the Swift financial communication network. In addition, the state television news channel Russia 24 (Rossiya 24) and the state channels RTR Planeta and TV Center are to be banned in the EU.

Is it possible to prevent the next package of sanctions from causing another “choke”? That is unlikely – also because decisions on sanctions have to be taken unanimously. Habeck spoke again in favor of abolishing this regulation. However, he admitted that this could be difficult – because you need a unanimous decision.

Summit participants appealed to the EU Commission to change course. Orban railed that the agency acted irresponsibly by proposing energy sanctions that were not properly negotiated. Austria’s chancellor, Karl Nehammer, said something similar: Normally, “you negotiate with the people you’re talking to before you announce the result.”

A possible gas embargo should therefore not be an issue in the EU for the foreseeable future. Several heads of government made it clear that there is a unified position. A gas embargo is “not an issue” for the next package of sanctions, said Nehammer. Belgium’s Prime Minister Alexander De Croo said that one should now wait and see the effects of the sixth package of sanctions./djj/DP/men

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