U.S. President Joe Biden on Tuesday imposed an immediate ban on Russian oil and other energy imports in retaliation for the invasion of Ukraine and Britain said it would phase out imports through the end of 2022.
The European Union did not join the ban because it is more dependent on Russian oil and gas supplies. Gas flows to Europe have so far been steady since the invasion, which Russia calls a “special military operation”, but Moscow on Monday warned that sanctions on Russian oil could prompt it to close a major gas pipeline to Europe.
Existing disruption to oil trade, caused by traders steering clear of Russian supplies due to concern they may unwittingly fall foul of sanctions imposed on Russia, is likely to worsen after the U.S. ban, traders said. Buyers will also be concerned about the kind of reputational hit that Shell took at the weekend for buying Russian oil.
Russia exports around 7 million barrels per day of crude and refined fuel, about 7% of global supply.
In 2021, energy was the most imported product by the European Union from Russia, accounting for 62% of total EU imports, or the equivalent of about 99 billion euros ($108 billion).