The EU published details of its sixth sanctions package against Russia June 3, including phasing out Russian crude imports in 6 months, and other refined products in 8 months.
The EU approved temporary derogations for Bulgaria and Croatia on the import of Russian seaborne crude oil and vacuum gas oil respectively, a statement published June 3 said.
It also approved a temporary exemption for crude shipments via pipeline for countries dependent on Russian supplies with no viable alternatives.
The EU has not given guidelines on how long these exemptions will remain in place.
The June 3 statement did not mention a ban on insurance related to shipping insurance and reinsurance. Earlier this week, president of the European Commission Ursula von der Leyen indicated that there is a ban on insurance and reinsurance of Russian ships by EU companies.
Trading, insurance and shipping executives said earlier this week that such a ban could further complicate trade in dry bulk and liquid commodities with Russia, making them more expensive, delaying scrapping of old ships, pushing up global freight and encouraging private deals with owners ready to call on sanctioned ports.
Alongside German and Polish measures, the new sanctions will see Russian oil import volumes drop by 92% by the end of the year, the French Presidency of the Council of the European Union tweeted June 2.
Platts Analytics estimates the latest EU measures will hit some 1.9 million b/d of Russian crude imports by the year end, with some 300,000 b/d still flowing to Hungary, Slovakia and the Czech Republic via pipeline. Another 1.2 million b/d of refined product imports from Russia would cease by the end of the year.
The Russian Foreign Ministry said in a statement June 2 that sanctions are highly likely to provoke further price increases, destabilize energy markets and disrupt supply chains.
Oil prices have seen major volatility in recent months, as Russia’s invasion of Ukraine raised supply security risks and triggered wide-ranging sanctions and self-sanctions on purchases of Russian oil.
Dated Brent was assessed at $100.49/b by Platts on Feb. 23, the day before Russia invaded Ukraine. It soared to $137.64 March 8 before dropping back. It was last assessed at $122.96/b June 1, S&P Global Commodity Insights data showed.
Other measures included in the package are a ban on providing services to the Russian oil sector, and disconnection of three Russian banks, including Sberbank, from the SWIFT global financial messaging system, according to EU statements.
Source: Spglobal.com
