Germany is willing to cut Hungary out of an EU-wide agreement on a crude oil embargo against Russia, Economy Minister Robert Habeck told German media today.
"If the Commission president says we're doing this as 26 without Hungary, then that is a path that I would always support," Habeck said, as quoted by Reuters, adding, "But I have not yet heard this from the EU."
Germany is one of the most vocal supporters of a Russian oil embargo and earlier this month said it was going to eliminate the commodity from its energy mix by the end of the year, whatever the rest of the European Union decides.
Hungary, for its part, has been the most vocal opponent of an embargo because of its almost complete dependence on Russian oil. Along with two other Central European states, Slovakia and the Czech Republic, Hungary asked for and was granted a temporary exemption from the embargo under discussion to give it more time to switch suppliers.
Bulgaria, which is also almost completely dependent on Russia in the imported oil department, was initially denied an exemption but, after threatening to veto the embargo, joined the other three.
The rest of the EU agreed to a six-month grace period to wind down purchases of Russian crude and a nine-month period for the wind-down of oil product purchases. Discussions of the embargo continue.
Germany had signaled before that it was ready to ditch Russian oil as well as Russian gas. Last month, Habeck said that Germany could stop importing Russian oil by the end of the summer. Later, he reported that the share of Russian oil in Germany's total imports had declined from 35 percent before the start of the war in Ukraine to just 12 percent. The new oil suppliers have not been named.
By Irina Slav for Oilprice.com
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Such a precedent if implemented could signal the first crack in the EU as a whole and could pave the way towards a future break-up of the bloc and all for the sake of cutting Russia’s revenues from oil exports at a time when President Putin is laughing all the way to the bank while the EU is inflicting considerable damage on its economy.
The EU is heel-bent on cutting its nose to spite its face as the proverbial saying goes but it will end up cutting more than its nose but also cutting any prospects of economic growth in 2022 and 2023.
Even before a ban, the EU has already downgraded its projected economic growth from 2.7% to 1.4% for this year.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London