EU increases pressure on Russia: New sanctions package for oil and gas!

EU increases pressure on Russia: New sanctions package for oil and gas!

The European Union approved a new package of sanctions against Russia on Friday, which is the 18th since the start of the Ukraine war. These measures are intended to further damage the Russian oil and energy industry. This is clear, as a flexible price cap is being introduced for Russian crude oil, which will now be 15 percent below the average market price. This move follows the experience of the previous price cap of $60 per barrel, which was seen as largely ineffective because it had too many loopholes. That's what she reports Financial Express, that despite the sanctions, Russia sold most of its oil exports at a higher price level.

EU foreign policy chief Kaja Kallas said this package of sanctions was one of the strongest against Russia, while Ukrainian President Volodymyr Zelensky described the measures as "timely and necessary", especially given the intense Russian attacks. The new sanctions also include transactions related to the Nord Stream gas pipelines as well as numerous banks that help circumvent these sanctions. According to the Associated Press 105 ships from the Russian “shadow fleet” were blacklisted, bringing the total number of sanctioned ships to over 400.

Political hurdles and negotiations

The agreement on the new sanctions was not entirely unproblematic and was initially blocked by Slovakia. This had expressed concerns, particularly about the economic consequences of a ban on imports of Russian gas from 2028, but finally agreed after assurances that there would be no serious economic consequences.

As Deutsche Welle reports, a compromise was found that should also ensure that the oil price cap is adjusted regularly. This affects sales to countries such as India, China and Turkey. In addition, companies that transport Russian oil below the new price cap will be sanctioned.

The discussion about the effectiveness of the sanctions remains tense among the EU member states. Critics doubt that these measures can actually influence the Kremlin's strategy, while supporters expect significant economic losses for Russia.

A look into the future

In addition to the ban on transactions involving the Nord Stream pipelines, 22 more banks, including two Chinese ones, will be decoupled from the international financial system SWIFT. This is a clear indication of the EU's continued pressure on Russia. But the challenges remain great: the US dollar dominates global oil trade, which significantly limits the EU's ability to enforce these measures.

In the long term, it remains to be seen whether the new sanctions can have the intended effect and to what extent they will actually put pressure on the Russian leadership around President Vladimir Putin. The topic remains explosive and will certainly continue to shape political discussions in Europe.