The European Union plans to ban Russian crude oil over the next six months and refine fuels by the end of the year as part of a sixth round of sanctions to pressure Vladimir Putin over his invasion of Ukraine.
The European Commission President Ursula von der Leyen said in a statement to the European Parliament that the Russian oil, seaborne and pipeline, crude and refined, will be a complete import ban. We will make sure that we phase out Russian oil in an orderly fashion, in a way that allows us and our partners to secure alternative supply routes and minimizes the impact on global markets. Von der Leyen said that the EU is proposing to cut off Sberbank and other lenders from the SWIFT international payment system.
The EU's 27 member states are expected to meet later on Wednesday to discuss the proposal.
The EU, the largest consumer of crude and fuel from Russia, wants to pressure Putin, so the move increases the stakes. In the year 2019, almost two-thirds of the bloc's crude oil imports came from Russia.
Financing, brokering, technical assistance and financing assistance are among the proposals that will include banning all services linked to transportation of Russian oil, officials said. The restrictions would also include insurance, two people said. The measures would follow the ban on Russian oil.
Von der Leyen has proposed banning three big Russian state-owned Russian broadcasters from EU airwaves, and sanctions against high-ranking military officers and other individuals who have committed war crimes in Bucha and are carrying out the siege of Mariupol. The EU banned RT and Sputnik in March. RT fought the ban in EU courts.
The package would also include banning the services of accountants, consultants and spin doctors from Europe to Russian companies, von der Leyen said.
The move is tough for Europe, which is also facing possible cut-offs of Russian gas due to Kremlin s demand to be paid in rubles.
Simone Tagliapietra, a research fellow at the Bruegel think tank, said that the EU gradual embargo on Russian oil is a risky bet, because it may leave Russian revenues high and imply negative consequences for the EU and global economy in the short term, not to talk about retaliation risks on natural gas supplies.
Diesel is a bit of a pinch point. Diesel supplies were limited before the war began. A record-shattering premium to crude oil and extremely bullish forward curves point to a market that is screaming for fuel. Europe, a region heavily reliant on imports from all over the world but most importantly from Russia, is at the centre of the global crisis.
According to Eurostat data, more than 40% of the EU's diesel-type fuel imports came from Russia in 2020. The U.K. is a major buyer of Russian product, though it has already said it will phase out supply from the country.