EU humiliated as bloc hands Putin over £87bn amid Ukraine war

Putin 'continues to use energy as a weapon' says Von der Leyen

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The EU has been exposed for handing Russia over €100billion (£87billion) amid the war in Ukraine for energy imports, despite scrambling to cut ties with Vladimir Putin. Since Russian troops first descended on their neighbouring country back in mid-February, imports of gas, coal and oil have continued to pour into the bloc, laying bare Europe’s staggering dependence on Russian fuels that continue to generate huge revenues for the Kremlin. For the first six months of the conflict, the Kremlin banked an eye-watering €158billion (£138billion) from fossil fuel exports. 

According to estimates from the Centre for Research on Energy and Clean Air (Crea), an independent Helsinki-based research group, the EU imported 54 percent of this, worth around €85billion (£75billion). And despite receiving only a fraction of the gas from Russia compared with volumes delivered in 2021, the bloc was still handing Putin the same amount of cash as prices were sent soaring. 

In fact, the volume of Europe’s fossil fuel imports from Russia has been slashed by half since the invasion as a result of both harsh western sanctions such a coal embargo, and due to deliberate gas cuts from Russia which hiked up prices. 

But despite the plummeting imports, which it was hoped would deal a blow to Putin and hamstring his war efforts, Crea has estimated that the EU still imports around €260million (£228million) worth of Russian fossil fuels every day. 

Lauri Myllyvirta, leqad analyst at Crea, said: “While capping prices and limiting imports from Russia, it’s essential for European countries to accelerate the shift from fossil fuels to clean energy. This year has revealed the reliance on fossil fuels as a fundamental national security and economic vulnerability.”

This comes after the EU agreed to impose a price cap on Russian oil last week as part of a sanctions package that European Commission President Ursula von der Leyen claimed would “make the Kremlin pay”. 

In what was the eighth round of harsh measures taken against Moscow to punish it for launching its brutal attack on Ukraine, EU ministers reportedly agreed on the measure following the Russian President’s threat to use nuclear weapons amid the conflict. 

Ms von der Leyen said: “We have moved quickly and decisively. We will never accept Putin’s sham referenda nor any kind of annexation in Ukraine. We are determined to continue making the Kremlin pay.”

But while the EU scrambles to scupper its dependence on Russian fuels, completely cutting ties with Moscow could risk shortages, higher prices, and even energy blackouts. And with some nations within the 27-member bloc being more dependent on Russian energy than others, furious EU bust-ups have appeared to delay quicker action from being taken.

For instance, the oil embargo was held up for weeks, until landlocked Hungary finally managed to agree on a package that exempts the nation from the oil embargo, which will come into full force in December.  

Along with other nations such as the Czech Republic and Slovakia, countries reliant on pipeline oil will not stop importing the fuel from Russia, a compromise the Commission had to make in order to get every EU nation to agree on the measure as fast as possible. 

And while a ban on EU imports of Russian coal was initiated on August 10 after a four-month wind-down period, Crea has pointed out that EU member states did not manage to enforce a provision in the ban that stopped EU-owned ships from transporting coal from Russia to third countries.

But the EU did publish new guidance last month that permitted the transfer of certain goods, including coal, from Russia to third countries to “combat food and energy insecurity around the world.”

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The EU is now set to stop purchasing Russian crude oil imported by sea in December, but it will continue to purchase Russian refined oil products by sea until February next year. But this could be particularly damaging to some of the most reliant countries in the bloc. 

For instance, Lithuania and Finland imported about 80 percent of their oil from Russia in November last year, according to data from the International Energy Agency. 

Although the bloc claims that its most recent sanctions slash the amount of oil it purchases from Russia by 90 percent, there are still several months before the embargoes take effect. This means the bloc will essentially keep bankrolling Putin’s war machine until it finally manages to completely cut energy ties with the Russian dictator. 

Much like the soaring prices of gas, which kept Putin’s pockets filled amid sanctions, oil prices have risen too. According to David Fyfe from Argus Media, this has seen Moscow’s revenue raked in from crude oil sales soared by 41 percent.

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