In Big Bid To Punish Moscow, EU Bans Most Russia Oil Imports

In the most significant effort yet to punish Russia for its war in Ukraine, the European Union agreed to ban the overwhelming majority of Russian oil imports after tense negotiations that tested how far the bloc is willing to go to ostracize Moscow.

From the moment Russia invaded on Feb. 24, the West has sought to make Moscow pay economically for its war. But targeting its lucrative energy sector was seen as a last resort in Europe and has proved hardest, since the bloc relies on Russia for 25% of its oil and 40% of its natural gas. European countries that are even more heavily dependent on Russia have been especially reluctant to act.

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In a move unthinkable just months ago, EU leaders agreed late Monday to cut around 90% of all Russian oil imports over the next six months.

Belgian Prime Minister Alexander De Croo called the embargo a “big step forward,” and Irish Prime Minister Micheal Martin hailed it as “a watershed moment.”

“The sanctions have one clear aim: to prompt Russia to end this war and withdraw its troops and to agree with Ukraine on a sensible and fair peace,” German Chancellor Olaf Scholz said.

Ukraine estimated the ban could cost Russia tens of billions of dollars.

“The oil embargo will speed up the countdown to the collapse of the Russian economy and war machine,” Foreign Minister Dmytro Kuleba said.

The deputy head of Russia’s Security Council said that energy sanctions against the country are intended to hurt ordinary Russians by making it harder for Moscow to fund social programs.

“They hate us all! The basis for these decisions is hatred for Russia, for Russians and for all its inhabitants,” Dmitry Medvedev, who is also a former president and prime minister, wrote on the Telegram messaging app.

Mikhail Ulyanov, Russia’s permanent representative to international organizations in Vienna, appeared to shrug the move off, though, saying Moscow will find other buyers.

Still, analyst Simone Tagliapietra said Russia will probably have to sell its oil at a substantial discount. Tagliapietra, an energy expert and research fellow at the Brussels-based think tank Bruegel, called the embargo “a major blow.”

Matteo Villa, an analyst at the ISPI think tank in Milan, agreed that Russia will take a pretty significant hit now but cautioned that the move could eventually backfire.

“The risk is that the price of oil in general goes up because of the European sanctions. And if the price goes up a lot, the risk is that Russia starts to earn more, and Europe loses the bet,” he said.

Russia has also not shied away from withholding energy to get its way. Russian state energy giant Gazprom said it is cutting off natural gas to Dutch trader GasTerra and Denmark’s Oersted company and is also stopping shipments to Shell Energy Europe that were bound for Germany. Germany has other suppliers, and GasTerra and Oersted said they were prepared for a shutoff.

Gazprom previously stopped the flow to Bulgaria, Poland and Finland.

Meanwhile, the EU is urging other countries to avoid placing trade barriers on farm products as Russia’s war increases the risks of a global food crisis.

Ukrainian President Volodymyr Zelenskyy has said Russia has prevented the export of 22 million tons of Ukrainian grain, much of it meant for people across the Middle East and Africa. He accused Moscow of “deliberately creating this problem.”

In other developments:

— Russian forces have seized around half of a key city in eastern Ukraine, according to the mayor. Analysts have painted the battle for Sievierodonetsk as part of a race against time for the Kremlin: The city is key to Russian efforts to complete the capture of the eastern industrial region of the Donbas before more Western arms arrive to bolster Ukraine’s defenses.

— A court in Ukraine convicted two Russian soldiers on Tuesday of war crimes for the shelling of civilian buildings. It sentenced both to 11 1/2 years in prison, concluding the country’s second war crimes trial since the Russian invasion.

The EU oil embargo, part of a new package of sanctions that will also target Russia’s biggest bank and state media outlets accused of spreading propaganda, covers crude oil and petroleum products but has an exception for oil delivered by pipeline.

That exception was demanded by Hungarian Prime minister Viktor Orban. Hungary gets more than 60% of its oil from Russia, much of it through the Soviet-era Druzhba pipeline.

The EU estimated around 90% of Russian oil will be banned by the end of the year. That figure includes a ban on all Russian oil delivered by sea — which accounts for two-thirds of the EU’s imports from Russia — plus a decision by Germany and Poland to stop using oil from the northern branch of the Druzhba pipeline.

The compromise laid bare the increasing difficulty of reaching consensus among EU leaders when important national interests are in play.

Agreeing on another round of measures is likely to prove much tougher: Next on the agenda is whether to target natural gas, which is much harder to cut off. That’s because it represents a larger percentage of Europe’s energy mix.

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Associated Press journalists Yuras Karmanau in Lviv, Ukraine, Mike Corder in The Hague, Netherlands, Colleen Barry in Milan, Italy, and Derek Gatopoulos in Athens contributed to this report.