At present, there is no unified position within the European Union over the possibility of a full embargo or punitive tariff on Russian oil and gas imports, acknowledged the High Representative of the Union for Foreign Affairs and Security Policy, Josep Borrell, in the German newspaper Die Welt on Monday 25 April.
While some EU Member States, such as the Baltic States and France, want to include the notion of an embargo on Russian oil in the sixth package of sanctions against Russia currently being prepared (see EUROPE 12934/2), other countries, in particular Germany and Hungary, continue to oppose limiting Russian oil and gas imports because of the impact on their economies.
According to an estimate by the German Central Bank published on 22 April, an immediate EU embargo on Russian gas could cost Germany up to 5% of its GDP compared to the Bundesbank’s short-term forecast from March, which is a loss of €180 billion.
Compared to the previous year, German GDP would fall by just under 2%, while inflation could rise by 1.5 percentage points (pp) in 2022 and by 2 pp in 2023, compared to a scenario where there is no embargo.
See the Bundesbank’s report (in German): https://aeur.eu/f/1cv (Original version in French by Damien Genicot)