Any ban on Russian gas imports should be decided before the summer, officials say.
The European Union could move closer to extending sanctions to Russian oil and even natural gas in coming weeks, EU officials told MNI, adding that German opposition to such a move is likely to eventually cede but that if there is to be an import ban on gas it would have to be in place before the summer.
With coal included in the latest sanctions package due to be concluded this week, an oil and gas embargo could come if further news of alleged Russian war crimes outrages public opinion and prompts what could be a quick shift in the German position, the officials said. An embargo on gas would be harder to impose after the warmer months, when homes and workplaces do not require heating, they said.
Completely replacing Russian gas, including the diversification of suppliers and the construction of liquefied natural gas terminals, will take years. The large investments required might be partly paid for by the EU’s existing EUR800-billion-plus NextGenerationEU programme aimed at restoring the economy after the Covid pandemic, officials said, adding that the EU's French presidency had floated the idea of diverting funds from less urgent infrastructure projects included in national recovery plans.
“Truth is that if an embargo is decided it must be done pre-summer. Personally, I would be in favour … but on the basis of a very detailed/ comprehensive roadmap,” one former senior Eurosystem official told MNI.
In the short-term, EU countries would have little option but to impose rationing on consumers and industry in the event of a ban on Russian gas imports, officials said. Asked whether there would be any alternative, one replied bluntly: “none.”
For the moment, the EU’s presidency is trying to foster consensus before imposing additional sanctions. While Germany is the main hold out, it found support from states including Austria and Belgium at this week’s Eurogroup meeting of finance ministers.
"If people want gas bans, we need to have an honest debate about the options," said an official from one national finance ministry "Would people go for rationing and closing of industries? Because this would be the consequence."
But an EU diplomat expressed exasperation with Germany’s glacial progress in agreeing to extend sanctions to gas.
“I would like very much to understand the German formulae for calculating sanctions: how many lives lost justify a proper oil embargo? How many more Buchas before we see action on oil? Maybe one or two? And, on gas, what would be the standard of atrocities we need to see?” the diplomat said.
A report published by the Conseil d’Analyse Economique puts the impact of a gas ban at around 0.15 to 0.3% in French gross national income. For Germany, the negative impact was estimated at around 0.3% and up to 3% in the most pessimistic scenarios.