The EU has imposed a partial oil embargo as part of its 6th sanctions package. Yet, between 24 February and 31 May, EU countries paid over EUR 55 billion for oil and gas imports from Russia. That’s the equivalent of roughly 15,000 T-14 Armata tanks or 60,000 cruise missiles. The EU may pay Russia an additional EUR 100 billion by year-end. Here is what can realistically be done to exhaust Russia’s petroleum-based incomes — and what stands in the way.
What does the oil embargo mean?
The European Union has introduced an embargo on Russian oil imports. The embargo will cover all Russian imports by ship. In addition, Germany and Poland agreed to stop buying Russian oil imported by pipeline. Together, this may cover less than 90% of Russian oil imports to the EU.
- Hungary, the Czech Republic, and Slovakia are allowed to continue importing Russian oil by pipeline (which represents roughly 13% of Russia’s oil exports to the EU). This is the first time since February that the EU allowed exceptions for specific countries in its sanctions against Russia.
- The international oil prices initially climbed on the news of the oil embargo. At least in the short term, Russia’s income from oil sales will remain stable.
- The embargo will only take effect from 1 January 2023. Until then, Russia may possibly earn an additional EUR 100 billion from oil and gas exports to the EU.