European summit: the EU does not plan an embargo on Russian oil

European summit: the EU does not plan an embargo on Russian oil

Attempts to broker a last-minute compromise aimed at getting Hungary to back a total ban on Russian oil ahead of an emergency EU summit later on Monday (May 30) have not progressed. It would seem that the leaders do not wish to argue and that they will consider “the big picture”.

Throughout Sunday, EU ambassadors discussed a compromise that should allow them to break the deadlock over the Russian oil embargo, which since May has prevented the Union from impose the sixth round of sanctions on Moscow because of the war in Ukraine.

As new sanctions hit member states, EU unity “starts to fall apart”as German Economy Minister Robert Habeck said.

Hungary continues to block the project, citing fears for its energy supply, as the country depends for 65% of its oil needs on Russian crude supplied by the Druzhba pipeline, which connects Russia to various points in central and eastern Europe. .

Budapest rejected a proposal to give it two years longer than other EU member states to get rid of Russian oil, saying it was unsuitable.

Hungary wants at least four years and at least 800 million euros of European funds to adapt its refineries to the treatment of non-Russian crude and to increase the capacity of the pipelines to neighboring Croatia.

A compromise presented

A compromise solution, tabled by France and submitted to national negotiators, consisted in excluding ” for the moment “ the Druzhba pipeline from a future oil embargo and to impose sanctions only on oil shipped to the EU by tanker, EU diplomats have said.

The Druzhba pipeline accounts for one-third of all EU oil supplies from Russia, while oil transported by sea accounts for the remaining two-thirds.

Slovakia and the Czech Republic, also supplied by the Druzhba pipeline, agreed to two-and-a-half-year exemptions, according to European diplomatic sources.

The proposal calls for ending purchases of Russian oil within six months and Russian oil products by the end of the year.

It also plans to impose additional sanctions on Russian banks and expand the list of Russians on the EU blacklist.

“A level playing field”

However, EU ambassadors failed to agree on the compromise, with EU officials saying the compromise proposal raised questions of fairness over the sanctions burden borne by member states.

According to some EU capitals, the “level playing field” of the Union’s single market would be distorted by the compromise plan to ban Russian oil delivered by tankers while allowing oil to be transported by pipelines.

Some Western European member states complained on Sunday (29 May) that the pipeline exemption would unfairly benefit countries like Germany and Poland that are not at risk of fuel shortages, while giving them a unfair economic advantage.

EU ambassadors are due to meet again early Monday morning, with some EU officials appearing to hope for a deal.

“It might not work, it might work, but I think we have a duty to try”said a European official.

“There is a will of all member states to work on oil and to ban oil [russe] European markets. The question is how to achieve this and how to take into account national specificities”he added, while sounding much more optimistic than others over the weekend.

If no deal is reached, which seems likely under the current circumstances, the issue will likely be discussed by EU leaders at the European Council, which several EU countries wanted to avoid.

A European Commission official dampened expectations for a sanctions deal at the summit by saying the leaders will not be “only briefly informed” Monday evening and that an agreement should be reached later in the week at the level of EU ambassadors.

The option of postponing the whole new sanctions package until a solution is found to provide Hungary with an alternative oil supply is also on the table.

The European Commission argued that since a ban would not come into effect until the end of the year, there would be no urgency to strike a deal quickly.

Promises of support, but…

However, Ukrainian President Volodymyr Zelensky, who is due to address EU leaders virtually, is expected to urge the Union to “eliminate Russian exports” three months after the invasion of Ukraine.

The previous summit, held in March, ended with a call for help and new sanctions, but also implicated Hungarian Prime Minister Viktor Orbán, who had blocked previous measures.

According to the latest draft conclusions, seen by EURACTIV, EU leaders are expected to discuss how best to help Ukraine four months after Russia’s invasion and how to deal with the impacts of the conflict on high oil prices. energy, an impending food shortage and the EU’s defense needs.

However, no new decisions are expected on any of the major topics.

One of the pledges is political support for a package of €9 billion in EU loans, together with a small grant component to cover part of the interest, so that Ukraine can maintain his government in place and pay salaries for about two months.

But the decision is only expected after the European Commission presents a proposal on how to mobilize the money.

The draft summit conclusions also hint that EU leaders will support the creation of an International fund for post-war reconstruction in Ukraine, without further details, and that they want to examine the possibility of confiscating Russian assets frozen for this purpose.

Asked by journalists that they did not see the urgency of the situation, a senior European diplomat defended the European Union’s record in its response to Russia’s war against Ukraine, saying that there was too much focus on sanctions.

“The Big Picture”

“The EU does not lose sight of the big picture”said the diplomat.

“We are continuously working on different particularities related to the war: financial support, food security, aid to refugees, etc. This is also clearly seen in the Council’s programme. The media may consider sanctions more interesting to follow”added the diplomat.

Although EU member states are beginning to feel a decision needs to be made quickly, the oil embargo’s postponement suits some, as it distracts from focusing on banning Russian gas.

“Gas is likely to prove even more difficult”said another top EU diplomat, adding that the technicalities of the oil embargo still need to be ironed out.

“If we want a derogation for one or two Member States for specific reasons of security of supply, we must ensure that legally (…) we do it in such a way that the internal market does not suffer more damage than expected »said the diplomat.

“It has to be done very carefully. This is a technical and legal issue, which we are still working on”he added.

EU unveils plan to seize frozen Russian assets

The European Commission is expected to unveil plans on Wednesday that will facilitate the confiscation of frozen assets linked to serious illegal activities and suspected criminals, including those evading EU sanctions against Russia, according to documents seen by EURACTIV.

Source

It is always my pleasure to provide insightful information on important topics and if you have learned something from my article then I thank you for taking the time to share it with your friends or family.

We put a lot of heart and invest a lot of time trying to bring you the most interesting articles.
You would encourage us to do it even better in the future. Thank you!

Related Posts: