According to information from the Bloomberg agency, talks are currently under way on a new package of sanctions that would include tightening measures against the Russian banking system.
This could be the end of a soap opera lasting several weeks: According to Bloomberg, the European Union is actually supposed to give up Russian oil by the end of the year. According to the American agency, the decision could even be made as early as next week at a meeting of European ambassadors.
A sixth package of sanctions should be adopted unanimously by the 27 member states, as required by the procedure. Hungary, which put both feet on the brakes on the issue, finally gave its approval. So has Germany, which has long been reluctant due to its very heavy reliance on Moscow gas, but this week took the plunge into a brutal hiatus.
The EU remains the top export customer for Russian oil, but the outbreak of the conflict has damaged trade ties between the two blocs, with orders falling from 1.2 million barrels a day in January to less than 800,000 in April.
Should an embargo be imposed until the end of 2022, interim measures would be taken to gradually reduce purchases. The Europeans are also discussing price controls and tariffs at the borders. Belarus, which is close to Moscow and has been involved in sanctions evasion, would be included.
The noose tightened around the banks
The embargo could be accompanied by other measures targeting Russian figures responsible in particular for alleged war crimes in Ukraine. Maritime transport and the digital sector could also be the subject of special attention.
On the financing side, a larger number of banks could be excluded from the international Swift system. Sberbank, Russia’s largest bank, which has already lost its European subsidiary, has come under particular European scrutiny following US and British sanctions.
Moscow had tightened its tone on gas
The Kremlin has been able to bear the brunt of the energy blackmail it has been running on Europeans for several weeks: in particular, it had demanded that its bills be paid in rubles to prevent its currency from unwinding. Despite European protests, several gas suppliers, including Germany’s Uniper, gave in to Russian threats to halt supplies. Conversely, Poland and Bulgaria, which categorically refused to back down, were decoupled from the Russian offer by Gazprom.
Moscow also took advantage of barrel price increases and gas price explosions (+85% year-to-date) to overcompensate for losses related to lower hydrocarbon export volumes. The Kremlin has raked in 44 billion euros in two months since the outbreak of the conflict, almost twice as much as in the previous year (24 billion euros).