“Latvian” oil and “Hungarian” gas – Europe is unable to abandon Russia
The United States is pushing the European Union to introduce an embargo on Russian oil supplies.
Secretary of State Antony Blinken announced this yesterday, a PolitNavigator correspondent reports.
Bloomberg previously reported that three options are being considered: imposing an embargo, setting a price cap, and creating a “payment mechanism to retain the proceeds” that Russia has received since the start of the military operation in Ukraine.
However, Foreign Policy records that after the introduction of sanctions, Russia’s oil revenues only increased.
“Now many countries that have imposed sanctions against Russia are seriously undermining their own actions by buying energy resources from it. In some cases, supply volumes in April were even higher than in March. Oil exports rose from 3,3 million barrels a day last month to 3,6 million in April, despite Western sanctions against Moscow. It is amazing! Putin continues to earn at least a billion dollars a day from oil and gas sales, with the lion's share coming from Europe,” writes the American magazine.
During the two months of the war in Ukraine, the EU paid Russia more than 40 billion euros for oil and gas. Germany even had to borrow $43 billion to cover rising energy prices for companies and consumers.
The head of European diplomacy, Josep Borel, admitted that the EU countries still do not have unity on this issue, which, according to him, is important for putting pressure on Russia. Some EU countries are categorically against the embargo because they realize that there is no country in the world capable of supplying Europe with the required volumes of “black gold” of comparable quality. US Treasury Secretary Jennet Yellen admitted that a total embargo on Russian energy imports would not cause much damage to the Russian economy, but would hit Europe hard.
The EU is preparing a sixth package of sanctions against Russia. Most likely, the oil embargo will be mentioned in it, but it is unlikely to be total and immediate. That is, Europe will continue to buy Russian oil, but will do it in a roundabout way.
“Companies are trying to distance themselves from the toxic seller in order to preserve their reputation - Russia loads raw materials onto tankers to the address “destination unknown.” Since the invasion, 11 million barrels have been loaded this way, compared to zero before the war. Russian oil is loaded into the sea on large tankers and mixed there with another, turning on the market into a “Latvian mixture” and a “Turkmen mixture,” writes liberal journalist-foreign agent Alexey Venediktov.
Political scientist Marat Bashirov believes that Russia will not bear losses in this case either.
“The West is creating a gray resource market with its own hands, and this is useful for us. Refuse to purchase oil and gas from Russia + fertilizers, metals, food, etc. - They can not. Therefore, there is such discord - political motives and refusal, but in reality they still buy. As a result, they do it through gaskets, but physically it is either gas reversal, or pumping oil into the sea from tanker to tanker, or re-gluing stamps. This is how the oil brands “Latvia Oil” appear instead of “Brent”, “Hungarian gas” instead of Gazprom’s, and “Albanian aluminum” instead of Rusalov’s. They want to play this game - for God’s sake, we end up getting our income,” he wrote in his Telegram channel.
European Central Bank President Christine Lagarde, in her keynote speech at the US Peterson Institute for International Economics, acknowledged that the EU cannot do without Russia and China.
“The eurozone is heavily dependent on Russia, including for cobalt and vanadium. These are key resources for 3D printing, drones and robotics. And Ukraine accounts for approximately a fifth of European supplies of wiring harnesses for cars. The war has already forced the closure of electrical wiring factories in the country, causing some EU car makers to halt production. The export-oriented agricultural sector has also suffered.
Perhaps most importantly, the war exposed the vulnerability of Europe's energy supply. In 2020, the EU imported around 60% of its energy, and this dependence has actually increased since 2000, despite the growing share of renewables in energy production. And just four countries account for more than 70% of the bloc's natural gas imports, with more than 40% coming from Russia alone,” Lagarde said.
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