WASHINGTON - A US ban on imports of Russian oil, coupled with a Russian threat to cut energy supplies to Europe, has fuelled fears globally of an energy war between Russia and the West.
“We are banning all imports of Russian oil and gas,” United States President Joe Biden announced in Washington on Tuesday (March 8).
“Putin seems determined to continue on his murderous path. No matter the cost… This much is already clear: Ukraine will never be a victory for Putin.”
The US is much less dependent on Russia for oil than Europe is. Last year, the US imported roughly 700,000 barrels per day of crude oil and petroleum from Russia – less than 10 per cent of the US’ oil needs – compared to the Europeans’ 4.5 million barrels per day.
Western-led sanctions against Moscow after the invasion of Ukraine have so far spared Russian oil and gas. Russia supplies 40 per cent of Europe’s gas and 30 per cent of its oil.
Mr Biden on Monday held a video conference call with the leaders of France, Germany and Britain, as he pushed for their support to ban Russian oil imports.
The Biden administration is reaching out to Saudi Arabia and Venezuela – whose government is also under sanctions – to boost production to offset bans on
Russian supplies and stave off global inflation.
“If Russia cuts off gas and oil to the European Union (EU), there will be a serious energy crisis and the EU will have massive demands on oil and gas throughout the world, causing prices to go to levels that were so far not even considered,” Dr Paul Sullivan, an energy expert and senior non-resident fellow with the Atlantic Council’s Global Energy Centre, told The Straits Times.
The impact of the US ban will be politically sensitive domestically.
Retail petrol prices have risen in the past week, topping US$4 a gallon for the first time in over a decade.
On Monday, Exxon Mobil and Chevron said they would boost their domestic oil production – though the effect would not be felt for a while.
Russia has warned that it can stop gas flows to Germany in retaliation for Berlin’s decision to suspend the controversial new Nord Stream 2 pipeline.
But Russia will also suffer blowback if it carries out the threat.
“The Russian economy would be further shattered,” Dr Sullivan said. “They rely too much on energy exports. Sixty per cent of their export revenues are from energy. Russia can sell more oil to China, but… there are limits; most oil pipelines out of Russia go to the EU.”
Britain, which like the US does not depend a lot on Russian oil, was on Tuesday also reported to be planning to ban imports.
“We have every right to take a matching decision and impose an embargo on gas pumping through the Nord Stream 1 gas pipeline,” Russian Deputy Prime Minister Alexander Novak said on Monday.
On Tuesday, energy giant Shell became the latest big corporation to announce a withdrawal from Russian oil and gas.
Japan also tightened its sanctions, freezing the assets of an additional 32 Russian and Belarusian officials and executives of companies with close ties to the government.
Meanwhile, on the ground in Ukraine, there is little sign of any let-up in hostilities, with the UN saying on Tuesday that at least 360 civilians had been killed and hundreds more injured. The actual figures were very likely much higher.
On Monday, the United Nations put the number of refugees fleeing the violence at more than 1.7 million.
The number is expected to top two million in the next two days, Mr Filippo Grandi, the UN High Commissioner for Refugees, told reporters in Oslo, Norway, on Tuesday.
In what was the only piece of good news from the front, hundreds of Ukrainians, mostly women and children, began evacuating from the city of Sumy in the north-east, as well as from Irpin, near Kyiv, on Tuesday – the first evacuation through a humanitarian corridor agreed with Russia after several failed attempts.
Russian forces, however, continued to bombard other cities.
Some 200,000 civilians in the south-eastern coastal city of Mariupol remained trapped with no running water, electricity or heat in freezing temperatures.