Ukraine has called for sanctions to be expanded to include a ban on Russian oil exports.
However, should an oil ban come about, Russia has warned it could cut off gas supplies to other countries.
The West imposed a series of economic sanctions on Russia after invading Ukraine, but oil has yet to be sanctioned directly.
US Secretary of State Antony Blinken said there were “very active discussions” about banning oil imports from Russia while “maintaining a constant global oil supply.”
But Germany and the Netherlands rejected the plan on Monday.
Germany is particularly reliant on Russian gas and therefore vulnerable to any restrictions that Russia imposes on gas flows.
Russia has announced it will close its main gas pipeline to Germany if the West imposes an oil ban.
After the invasion of Ukraine, the approval and opening of the gas pipeline Nord Stream 2 from Russia to Germany was stopped.
But Russian gas is still imported around the world through other routes.
- The Nord Stream 2 Pipeline and the Ukraine Crisis
- IEA: Green energy needed to avoid price turbulence
Russia is the third largest oil producer in the world after the US and Saudi Arabia.
Of around five million barrels of crude oil that is exported every day, more than half goes to Europe.
The US is less dependent on Russian oil, with about 3% of its imported oil coming from Russia in 2020.
Much of Europe is heavily dependent on Russian gas, with Russia providing about 40% of EU gas imports.
Gas and oil prices have already risen sharply and would rise further if Russia halted exports.
Russian Deputy Prime Minister Alexander Novak said the rejection of Russian oil would have “disastrous consequences for the world market” and push prices above $300 a barrel.
Countries would have to source more supplies from elsewhere – which would be particularly difficult with gas.
If Russia stopped gas supplies, Italy and Germany would suffer particularly, as they receive the largest supplies from Russia.
Russia supplies only about 5% of Britain’s gas supply and the US does not import Russian gas.
However, prices in the UK and US have still risen significantly due to the knock-on effect of supply shortages in other parts of the world.
Finding alternative sources is not easy.
“It’s harder to replace gas because we have these big pipes that bring Russian gas to Europe,” says Ben McWilliams, an energy policy analyst.
“With oil, it should be easier because there aren’t that many pipelines — some are coming from Russia, but there’s also a lot of supplies from elsewhere.”
Think-tank Bruegel predicts that Europe could potentially import more liquefied natural gas (LNG) from the US if Russia halted supplies to Europe.
It could also increase the use of other energy sources, but this is neither quick nor easy.
“Renewable energy takes time to roll out, so this is not a solution in the short term,” says research analyst Simone Tagliapietra.
“So what can make a difference for next winter is a fuel switch like opening up coal-fired power plants like Italy and Germany are planning for contingency.”
Another possibility would be to reduce the energy requirement.
“I think if we live in a world where Russian oil and gas stops flowing to Europe, then we need rationing measures,” says McWilliams.
“They definitely need to be talking to certain industries, and part of the conversation now is whether we can tell households to turn their thermostats down a degree, which can save a significant chunk of gas.”
EU leaders are set to unveil a plan on Tuesday to reduce their reliance on Russian gas.
The US has asked Saudi Arabia to increase its oil production but has rejected previous US requests to increase production in order to lower oil prices.
Saudi Arabia is the largest producer in Opec, the oil cartel that accounts for about 60% of internationally traded crude. Because of this, Opec plays a key role in influencing oil prices.
Russia is not in Opec but has been working with it since 2017 to limit oil production to keep producers’ revenues going.
The US is also considering easing Venezuela’s oil sanctions. It used to be a major US oil supplier, but recently Venezuela has sold most of its oil to China.
Europe could turn to existing gas exporters like Qatar or Algeria and Nigeria, but there are practical obstacles to rapidly expanding production.
Consumers will face rising energy and fuel bills as a result of this war.
In the UK, household energy bills have been kept in check by an energy price cap.
But bills will rise by £700 to around £2,000 in April when the cap is raised. They are expected to reach around £3,000 when the cap is raised again this autumn.
Petrol and diesel prices in the UK have also skyrocketed and petrol is expected to hit 175p a liter as the war rages on.
In the US, gasoline prices have hit their highest level since 2008, with the American Automobile Association saying gas pump prices rose 11% over the past week.
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