U.K. Plans to Ban Russian Oil Imports in New Sanctions Move

 U.K. Plans to Ban Russian Oil Imports in New Sanctions Move

Imports of oil, refined products to be phased out by end-2022

U.K. acts in concert with U.S.; ban won’t apply to natural gas

Bloomberg

ByJoe Mayes

March 8, 2022, 5:53 PM GMT+3Updated onMarch 8, 2022, 7:24 PM GMT+3

The U.K. government will ban all imports of Russian oil, its latest sanctions move against Vladimir Putin’s administration over the war in Ukraine. 

The measure -- taken in concert with the U.S. -- will be phased in over the rest of 2022, Business Secretary Kwasi Kwarteng said. The ban applies to refined products such as diesel -- which the U.K. relies on Russia for about a third of its imports. It won’t apply to natural gas.

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The British government has been looking for ways to further put pressure on the Putin regime after sanctioning its banks and a number of tycoons. Boris Johnson’s government has been criticized for some elements of its response to the war in Ukraine, such as the speed of processing visas for Ukrainian refugees and the number of wealthy Russian individuals sanctioned relative to the U.S. and European Union.

Diesel Matters Most

One-third of U.K. diesel imports come from Russia, no others come close

Source: Eurostat data for 2019

Banning Russian oil will put further upward pressure on energy prices in the U.K., where Britons already face a cost-of-living crisis due to soaring inflation and a tax burden on course to be the highest since the 1950s. 

U.K. imports of Russian oil totaled about 4 billion pounds ($5.3 billion) last year, according to Bloomberg calculations based on monthly data from the Office for National Statistics. The figure, which includes crude oil and refined products, amounts to 13.4% of total oil imports from all countries. The figure for diesel alone is much higher, according to Eurostat data for 2019.

The EU is still divided over how to tackle Russian fossil fuel imports -- and weaning other European countries off Russian oil is a bigger ask. That’s because almost all of the U.K.’s refineries are supplied with shipments of crude oil by ship, meaning they have greater flexibility to import supplies from different countries. 

Other refineries across Europe are much more deeply entrenched to Russia’s main export blend, Urals crude. Plants such as Germany’s PCK Schwedt and Leuna or Poland’s Plock are directly connected to Russia’s expansive network of pipelines making it much more difficult to sever ties.

— With assistance by Alex Longley, Laura Hurst, Josh Robinson, and Julian Lee