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The European Commission has proposed a fifth round of sanctions on Russian commerce in response to the recently-discovered evidence of war crimes in the town of Bucha, Ukraine. This time, a partial ban on Russian shipping is on the table, with a broad exemption for ships carrying the most valuable Russian exports – oil and gas.
“[We propose] a ban on Russian vessels and Russian-operated vessels from accessing EU ports. Certain exemptions will cover essentials, such as agricultural and food products, humanitarian aid as well as energy,” said EC President Ursula von der Leyen in a statement Tuesday.
Energy accounts for more than 60 percent of the value of EU imports from Russia. Bilateral trade between the EU27 and the Russian Federation is dominated by a Europe-bound flow of about $75 billion per year worth of crude oil and refined products, followed by roughly $20 billion worth of natural gas and LNG.
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If the sanctions package passes as proposed, Russian coal shipments will no longer be part of the landscape of European energy. “We will impose an import ban on coal from Russia, worth [$4.3 billion] per year. This will cut another important revenue source for Russia,” said von der Leyen.
However, Russian oil and gas will be far more difficult to disentangle from the European economy – particularly for Germany, Europe’s largest economy, which sources more than half of its natural gas and one-third of its oil from Russian producers. In Tuesday’s statement, von der Leyen said that the EC is “working on additional sanctions, including on oil imports.” She added that the EC is considering several non-sanctions options for Russian energy purchases, like “specific payment channels such as an escrow account,” which would hold payments in limbo until the war is over.
Other measures proposed Tuesday include a ban on Russian and Belarusian trucks entering the EU; targeted export bans on certain transportation equipment, machinery and computer technology; import bans on Russian liquor, seafood and other commodities; and an exclusion of all Russian companies from public procurement contracts in all EU nations. The EC also plans to sanction four Russian banks, including the second-largest, VTB.