With the import ban on Russian coal, the EU is breaking a taboo to punish Russia in the war against Ukraine. Experts continue to warn of embargoes on oil and gas. Are there alternatives?
Energy experts have warned of serious economic consequences if Russian gas supplies are cut off in response to the war in Ukraine.
“A full embargo would trigger an immediate recession in Europe, inflation would continue to rise and domestic politics would become even more difficult,” economist Simone Tagliapietra from the Bruegel think tank in Brussels told the German Press Agency. Instead, he proposes introducing tariffs on Russian energy in order to put further pressure on Russia.
Raphael Hanoteaux from the organization E3G said with regard to a gas embargo: “German industry, for example, would lose its competitiveness.” The reason for this is closures in the industry and even higher prices.
From the beginning of August, an embargo on Russian coal will apply, which the EU countries agreed on this week. Tagliapietra estimates that the EU currently spends €15 million a day on coal from Russia, but much more on Russian gas – around €400 million a day – and €450 million on oil from the country. That is why Poland and the Baltic countries, for example, are calling for more far-reaching measures.
Tagliapietra proposes tariffs on imports
According to the experts, an oil supply stop would have consequences for the world market. “That would have an effect on the global price, since a large part of the volume would simply no longer be available, but the demand would not decrease,” said Hanoteaux. About half of the oil shipped from Russia to Europe comes through pipelines or ships across the North Sea, which would be difficult to divert, he said. A higher oil price from lower supply would affect not only Europe but also developing countries that are already struggling, Bruegel’s Tagliapietra said.
“Instead of these embargoes, the best thing would be to immediately put a tariff on all these oil and gas imports,” suggests Tagliapietra. In his view, this would reduce Russia’s revenues and at the same time limit the effects on the European economy. Since Russia can only sell some of its oil and gas to Europe, companies like Gazprom would be forced to pay such a tariff.
According to Tagliapietra, the money could be used to cushion the high energy prices for consumers or to finance the reconstruction of Ukraine. “One advantage of the tariffs is that we can put pressure on the Russians: If they continue as before, you can increase the tariffs over time,” said Tagliapietra. According to him, the EU Commission and the EU countries are investigating how such tariffs could be designed.
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
