Oil and natural gas prices made a sharp increase in Europe on Wednesday after the EU unveiled a long-awaited proposal that would phase out imports of Russian crude in six months..The EU aims to apply increased and direct pressure on Russian President Vladimir Putin over his country’s invasion of Ukraine..EU countries are major importers of Russian oil and oil products importing 3.5 million barrels daily. The region also depends heavily on gas supplies. In 2019, almost two-thirds of the bloc’s crude oil imports came from Russia..EU Commission President Ursula von der Leyen announced this latest round of sanctions will include a complete import ban on all Russian oil..The ban includes both crude and refined products and would affect seaborne pipeline shipments. Von der Leyen also announced Russia’s top bank, Sberbank, would be sanctioned. The EU’s proposal includes denying the bank’s access to the international SWIFT payment system, von der Leyen said. The Russian Agricultural Bank and Credit Bank of Moscow will also be on the banned list..While Von der Leyen promises the planned embargo will be implemented “in a way that allows us and our partners to secure alternative supply routes,” German Economy Minister Robert Habeck warned Germany will suffer the consequences, citing potential shortages and further price rises..“Russian oil can be replaced on the world market in the short term, but with additional costs and logistical challenges,” German industry trade group BDI said Wednesday. “Given the oil embargo, energy prices will probably to continue to rise.”.Victoria Scholar, head of investment at Interactive Investor, said in a note to clients,“Russia provides around a quarter of EU oil imports with Germany the top buyer importing around a third of its oil last year. This development is likely to create severe headwinds for the EU economy, particularly Germany with the potential to push price levels higher and exacerbate the inflationary backdrop.”.EU diplomats discussed the sanctions on Wednesday. Their successful implementation would require a unanimous vote among the region’s 27 member states..Hungary was not on board with the oil phase-out schedule — foreign Minister Peter Szijjarto said the proposal in its current iteration would compromise Hungary’s energy security..An EU source told Reuters on Wednesday that Hungary and Slovakia will be able to continue with their Russian crude oil imports until the end of 2023 under existing contracts. Slovakia is also requesting the EU exempts the country for three-years, Economy Minister Richard Sulik told reporters after a government meeting Wednesday..Germany put its shoulder into the proposal with Economy Minister Robert Habeck announcing “the transition period is sufficiently long that we can take all precautions to create alternatives to Russian oil in Germany.”.Also included in the package is a ban on property transactions with Russian nationals, residents, and entities, with exemptions for EU citizens. .UK Foreign Secretary Liz Truss said Wednesday she’ll deny Russia’s access to UK management consultants, accountants and public relations firms..The proposal also bans EU businesses from providing services, including insurance, connected to the global transportation of Russian oil and products. The vast majority of the world’s tanker liability cover is arranged through a London-based organization that is subject to European laws..At press time, energy resource prices were as follows:.West Texas Intermediate crude for June delivery CL.1, +4.56% CL00, +4.56% CLM22, +4.56% rose $3.45, or 3.4%, to $105.86 a barrel on the New York Mercantile Exchange.July Brent crude BRN00, +4.28% BRNN22, +4.28%, the global benchmark, rose $3.25, or 3.1%, to $108.22a barrel on ICE Futures Europe.June natural-gas futures NGM22, +5.18% rose 2.4% to $8.351 per million British thermal unitsJune gasoline RBM22, +4.00% rose 2.4% to $3.585 a gallon, while June heating oil HOM22, +1.79% was up 0.6% to $4.108 a gallon..Amanda Brown is a reporter with the Western Standard.abrown@westernstandard.news.Twitter: @WS_JournoAmanda
Oil and natural gas prices made a sharp increase in Europe on Wednesday after the EU unveiled a long-awaited proposal that would phase out imports of Russian crude in six months..The EU aims to apply increased and direct pressure on Russian President Vladimir Putin over his country’s invasion of Ukraine..EU countries are major importers of Russian oil and oil products importing 3.5 million barrels daily. The region also depends heavily on gas supplies. In 2019, almost two-thirds of the bloc’s crude oil imports came from Russia..EU Commission President Ursula von der Leyen announced this latest round of sanctions will include a complete import ban on all Russian oil..The ban includes both crude and refined products and would affect seaborne pipeline shipments. Von der Leyen also announced Russia’s top bank, Sberbank, would be sanctioned. The EU’s proposal includes denying the bank’s access to the international SWIFT payment system, von der Leyen said. The Russian Agricultural Bank and Credit Bank of Moscow will also be on the banned list..While Von der Leyen promises the planned embargo will be implemented “in a way that allows us and our partners to secure alternative supply routes,” German Economy Minister Robert Habeck warned Germany will suffer the consequences, citing potential shortages and further price rises..“Russian oil can be replaced on the world market in the short term, but with additional costs and logistical challenges,” German industry trade group BDI said Wednesday. “Given the oil embargo, energy prices will probably to continue to rise.”.Victoria Scholar, head of investment at Interactive Investor, said in a note to clients,“Russia provides around a quarter of EU oil imports with Germany the top buyer importing around a third of its oil last year. This development is likely to create severe headwinds for the EU economy, particularly Germany with the potential to push price levels higher and exacerbate the inflationary backdrop.”.EU diplomats discussed the sanctions on Wednesday. Their successful implementation would require a unanimous vote among the region’s 27 member states..Hungary was not on board with the oil phase-out schedule — foreign Minister Peter Szijjarto said the proposal in its current iteration would compromise Hungary’s energy security..An EU source told Reuters on Wednesday that Hungary and Slovakia will be able to continue with their Russian crude oil imports until the end of 2023 under existing contracts. Slovakia is also requesting the EU exempts the country for three-years, Economy Minister Richard Sulik told reporters after a government meeting Wednesday..Germany put its shoulder into the proposal with Economy Minister Robert Habeck announcing “the transition period is sufficiently long that we can take all precautions to create alternatives to Russian oil in Germany.”.Also included in the package is a ban on property transactions with Russian nationals, residents, and entities, with exemptions for EU citizens. .UK Foreign Secretary Liz Truss said Wednesday she’ll deny Russia’s access to UK management consultants, accountants and public relations firms..The proposal also bans EU businesses from providing services, including insurance, connected to the global transportation of Russian oil and products. The vast majority of the world’s tanker liability cover is arranged through a London-based organization that is subject to European laws..At press time, energy resource prices were as follows:.West Texas Intermediate crude for June delivery CL.1, +4.56% CL00, +4.56% CLM22, +4.56% rose $3.45, or 3.4%, to $105.86 a barrel on the New York Mercantile Exchange.July Brent crude BRN00, +4.28% BRNN22, +4.28%, the global benchmark, rose $3.25, or 3.1%, to $108.22a barrel on ICE Futures Europe.June natural-gas futures NGM22, +5.18% rose 2.4% to $8.351 per million British thermal unitsJune gasoline RBM22, +4.00% rose 2.4% to $3.585 a gallon, while June heating oil HOM22, +1.79% was up 0.6% to $4.108 a gallon..Amanda Brown is a reporter with the Western Standard.abrown@westernstandard.news.Twitter: @WS_JournoAmanda