The European Union plans to impose an oil embargo on Russia

Berlin / Brussels.Brussels makes it exciting. Days ago, the European Union Commission was expected to present proposals for the sixth package of sanctions against Russia, the main component of which – according to all that is known – is an embargo on Russian oil. But this has not happened yet.

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Above all, Hungary and Slovakia are still fighting. Both countries are highly dependent on oil supplies from Russia. Sanctions must be taken unanimously in the EU; And when in doubt, each government can stop the package on its own. Intense negotiations are underway behind the scenes to find a unified European line. According to insiders, consideration is being given to persuading Budapest and Bratislava with longer transition periods.

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In less than four weeks, Germany’s largest gas importer, Uniper, will have to foot the next bill for Moscow. Kremlin ruler Vladimir Putin insists on paying in rubles.

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According to reports, the European Union will also impose sanctions on Sberbank, Russia’s largest bank. It was said that Sberbank will be cut off from the Swift international banking communications system. On the other hand, it seems that Gazprombank, by whose accounts the Europeans manage their gas transactions with Russia, is still exempt from the sanctions.

The European Union is also targeting other individuals in Russia. Their assets in Europe will be frozen. According to Brussels, lobbyists advising companies in Russia should be on the sanctions list.

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Regardless, preparations are underway in Germany to end deliveries from Russia. Federal Economy Minister Robert Habeck (Greens) said he has reduced Russia’s share of German oil supplies from 35 to 12 percent since the outbreak of the war.

One city is particularly affected

Habeck’s problem: Almost all of the 12% is attributable to the PCK refinery in Schwedt, which is supplied with crude oil via the “Druschba” (German Friendship) pipeline from Russia of which the Russian state oil company Rosneft is the largest shareholder. This is a problem in many ways, because Rosneft does not want to abandon Russian oil, and the company does not particularly like to talk about the medium- and long-term perspective of the industrial company.

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Habeck thinks EU oil embargo on Russia is ‘very likely’

Habeck said the European Commission will present proposals for a sixth set of sanctions on Tuesday. There will definitely be some oil in there.

In the city on the Oder River, uncertainty is currently evident. 1200 people work in the vast refinery in front of the gates. Although the workforce is only a fraction of the 8,000 workers who worked at the former petrochemical complex in East German times, the refinery is still the most important employer in the region today.

Federal and state politicians are currently doing their best to placate the people in Schwedt, who have already gone through a structural fracture. For example, on Monday, when Secretary of State for Economic Affairs Michael Kellner (Greens) visited the city and factory buildings. Kellner promises that “the federal government will do everything in its power to ensure that the PKK has a future.” It is now the most important goal of ensuring supply condition.

It is not only about jobs at Schwedt, but also about supplying large parts of East Germany and the Berlin metropolitan area with diesel, superfuel, heating oil and kerosene. Economy Minister Habek announced at the beginning of the week that if the ban takes effect immediately, “it will become bumpy in the east.” Then you have to adapt to fuel price jumps and perhaps also temporary supply bottlenecks.

“If sanctions drive up prices and disrupt the supply chain, this also makes the transition to renewable energies more difficult. This would be counterproductive,” warned Nina Scheer, a spokeswoman for energy policy for the SPD parliamentary group. “A ban should not be announced today that the European Union will not be able to tolerate until later or in the future,” the Social Democrat politician added. The latter implies the effects of a price increase and reveals dependencies. And when in doubt, both will only benefit the actual consignee of the penalties, which should be avoided.”

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In order to limit the effects, the Ministry of Economic Affairs has been working for weeks to find alternative sources of supply for Schwedt. 55 to 60 percent of the oil needed can come by ship through the port of Rostock. More is not possible, because the existing pipeline from Schwedt to the Baltic Sea has a relatively small diameter.

The remaining 40 to 45 percent could be landed at Danzig and sent to Schwedt via Druzhba. Problem: The Polish government has indicated that it is not ready to take such a step as long as the refinery is majority-owned by Russia. It is also not entirely clear whether Rosneft would be involved in such a deal.

In order to be able to take action if the worst of the worst happens, the German Bundestag passed a new version of the Energy Supply Law last week, which allows the federal government to put critical infrastructure under tutelage and, if necessary, even confiscate it-is. According to the coalition departments in Berlin, the regulation explicitly targets the refinery in Schwedt.

No one can currently predict whether or not it will be used. Shell Oil Company, the refinery’s second most important shareholder alongside Rosneft, promised the federal government that it would take care of oil purchases in Rostock in the event of a ban. Everything else is currently uncertain.

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