The International Energy Agency believes that the EU could reduce a third of its purchases while maintaining the decarbonisation agenda
While NATO governments have been discussing a possible boycott of Russian oil and gas since the weekend, at a refinery in the port of Merseyside, the British union Unite applied a drastic interpretation of the will of its government. Its members refused to offload Russian fuel, as happened on Friday at a liquefied natural gas platform at the mouth of the Thames.
The rule is that ships whose owner, flag, operator, etc., are Russian, are not allowed to dock, but the oil tanker Seacod, anchored for four days in the estuary that bathes the region that includes Liverpool, is under the German flag. It is not clear, according to ITV, that the ship did not unload before the union’s announcement, but the Seacod left in any case heading north, the west coast of Scotland.
Prime Minister Boris Johnson did not, however, correct the union’s interpretation of the rule. On the contrary, this Monday he added his voice to that of the German Chancellor, Olaf Scholz, pointing out to the American Secretary of State, Antony Blinken, that “the use of Russian oil and gas in Europe cannot be closed overnight.”
Blinken provoked a spectacular rise in the price of oil – close to the 150 dollars per barrel that was reached in 2008 – stating that he was studying with his European partners the boycott of energy supplies from the invading country of Ukraine. The UK could do without Russian gas, but it has a substantial reliance on its oil, especially refined oil.
The International Energy Agency (IEA) believes that EU countries can reduce their gas purchases from Russia by a third (140,000 million cubic meters per year), maintaining decarbonization plans. They could cut them in half by increasing coal production. There are no proposals on how EU countries could quickly do without their imports of Russian oil, 34% of total purchases abroad.
Have cold
Total amounts and percentages hide large national variations. Poland, on the border of the war, acquires 58% of its oil from Russia. Finland, 80%. Spain and the United Kingdom, 11%. Reaching a common criteria on the boycott would be complicated and the diversification of suppliers, one of the IEA’s recommendations to reduce dependency, is not easy in the current oil market.
Blinken’s initiative is that of a ruler of a country that has increased imports of Russian oil in recent years but whose energy trade balance places it as a net exporter. For self-sufficient Washington, the boycott of Russian oil and gas is the instrument that could bring about the rapid collapse of the Russian economy and finish off the sanctions plan to topple the Moscow regime.
According to the calculation of Michael Bernstam, a researcher at the conservative Hoover Institution in the United States, the digitization of banking and money means that the Bank of Russia has lost control of 60% of its foreign currency reserves: they are deposits in banks central and commercial offices of other countries, which are located in the accounting books of their computers.
In an article published last week in the ‘Financial Times’, Bermstam affirmed that the respected governor Elvira Nabiullina has 125,000 million in gold left in her coffers, some 77,000 in Chinese bonds denominated in renminbi, the five billion that must be deposited in the quota of the International Monetary Fund and some 28,000 million in hard currency.
Banking crisis, inflation and retreat towards a self-sufficient economy seem inevitable. Oil and gas revenues account for more than half of Russia’s healthy current account balance of 110 billion euros. Topple Putin? Chancellor Scholz believes that the pressure measures have to be “sustainable”. Solidarity with Ukraine and the desire to overthrow the tyrant collides with the willingness to be cold, lose mobility and industrial production in rich Europe.
Topics
Boris Johnson, Vladimir Putin, International Energy Agency, NATO, European Union (EU), United States, Europe, Finland, Moscow, United Kingdom, Russia, Ukraine, War in Ukraine
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