EU Oil Ban on Russian Seaborne Crude Begins

Coinciding with the G7 oil price cap today is Europe’s long-awaited ban on Russian oil imports.

• EU countries will not be able to import Russian crude oil by ship, with the exception of Bulgaria, which has been given longer to comply.
• The ban is expected to result in a global reshuffling of crude flows as Russia targets further flows towards Asia, its key outlet since it has been hit by western sanctions this year.
• Higher Russian volumes into Asia at discounted prices will likely eat further into Middle Eastern market share- freeing it up to head to Europe instead.
• The EU seaborne crude ban does not apply to oil that comes into Europe from Russia via pipelines meaning Hungary, the Czech Republic and Slovakia will continue to receive Russian oil through the Druzhba pipeline.
• Germany and Poland also receive supplies by pipeline but have pledged to stop these imports by the end of this year.
• Brussels has said that around 90 percent of Russian oil imports to the EU will be covered by the ban by the end of this year.