The EU studies imposing a ceiling on the price of Russian oil to corner its war economy | International


The European Union plans to shake the Russian war economy. The foreign ministers of the member states agreed this Thursday to promote a new package of sanctions against the Vladimir Putin regime. This decision comes after the nuclear threats against the West by the head of the Kremlin, his declaration of “partial mobilization” – the first decreed in Russia since World War II – to swell its troops in Ukraine and the call for pseudo referendums in the occupied Ukrainian territories to annex them to Russia. On the table, within the new package, it is contemplated to impose a ceiling on the price of Russian oil —like the one agreed by the G-7— and also to expand the list of high-tech products banned from exports. The EU thus seeks to give a new twist in its punishment of the Russian economy and people linked to Putin’s war against Ukraine.

The foreign ministers of the Twenty-seven agreed in an emergency meeting convened early Thursday in New York, where they attend the United Nations General Assembly, to send more weapons to Ukraine and to propose a new package of sanctions. But getting the new package off the ground is not going to be easy. Hours after the meeting in New York, the Hungarian Prime Minister, Viktor Orbán, has again stepped out of the picture.

The ultra-nationalist leader, close to Putin and one of the loudest voices within the EU against the restrictive measures against Russia, is going to call a “national consultation” on the advisability of sanctions, an opportunity to strengthen his rhetoric against the proposal with custom vote. The Fidesz government often uses these consultations (such as the one on migration, refugees and even on George Soros, whom it blames for all the ills of society) to carry out state propaganda.

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In a context of crisis due to the fall in the supply of Russian gas, with electricity prices skyrocketing throughout Europe and as Putin increases his stakes in his energy battle against the EU, Orbán’s initiative could crack the unity of the EU or at least to make it more expensive to carry out the measure, which could be formalized in October, when the foreign ministers of the member states meet in Brussels. The previous package of sanctions, the sixth – the seventh was actually to cover cracks in previous measures – took more than four weeks of negotiations to get ahead.

However, after the escalation and Putin’s resounding threats to use nuclear weapons, voices are increasing calling for a vigorous reaction from the EU, which has defined Putin’s measures as a sign of weakness and that he is losing the war. “We have decided to present additional restrictive measures against Russia as soon as possible in coordination with the partners”, said the High Representative for Foreign Policy of the EU, Josep Borrell, after the meeting with the foreign ministers of the Twenty-seven, in which they heard to Dmitro Kuleba, the head of Ukrainian diplomacy. “We will continue to support Ukraine’s efforts by supplying military equipment,” he said without elaborating. Before, the president of the European Commission, Ursula von der Leyen, remarked in an interview with the CNN channel that she will propose to include additional controls on the export of civil technology.

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Moscow insists that the EU sanctions do not work, which include a ban on raw materials such as coal and which also target the Russian export and import market, as well as a good number of people linked to the Kremlin (from officials to oligarchs, through relatives of Putin’s closest circle). The latter are prohibited from entering community territory and have seen their assets frozen in Europe. But reality is stubborn in the face of media propaganda from the Russian regime’s orbit: sanctions are affecting the Russian market with examples as basic as airlines reusing parts from old planes to keep those they can in the air, the lack of components.

Josep Borrell, head of European diplomacy, this Wednesday in New York. Julia Nikhinson (AP)

The new round of restrictions against Moscow would be added to the measures against Russian exports, which had 50% of its market in the EU; a veto on oil imported by ship; the disconnection of Russian banks from the SWIFT financial communication system, a key instrument for international economic relations, and the prohibition of broadcasting in community territory of several television channels linked to the Kremlin.

In addition, the export of numerous essential goods for Russian industry, such as semiconductors, aviation equipment or technology for the energy and space sectors, has been restricted. The export to the EU of coal, iron, steel, wood or cement has also been prohibited. European sanctions packages have also affected transport. Since February, all Russian airlines have been banned from entering Union airspace or taking off from any airport in a Member State.

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