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Russia sanctions: How can the world cope without its oil and gas? Russia sanctions: How can the world cope without its oil and gas?
(25 days later)
A key Russian gas pipeline has remained closed, severely limiting supplies as European countries struggle with high energy prices. A key Russian gas pipeline to Europe has been closed indefinitely because of leaks, meaning gas supplies to the continent will remain tight heading into winter.
Western countries are trying to cut their dependency on Russian oil and gas following the invasion of Ukraine in February. Nord Stream 1, an underwater pipeline running across the Baltic Sea to Germany, had been supplying EU states with 35% of all the gas they imported from Russia.
How much Russian gas does Europe use? EU leaders suspect the leaks were created deliberately, but have stopped short of blaming Russia for them.
Russia supplied the EU with 40% of its natural gas last year. How did the leaks occur?
Operators noticed leaks in Nord Stream 1 in a stretch of pipe near the Island of Bornholm in the Baltic Sea. There were also leaks in a parallel pipeline called Nord Stream 2, which is not yet in use.
Seismologists in Denmark said there had been explosions under the sea in the same area as the leaks occurred.
President of the European Commission Ursula von der Leyen says the pipelines were probably sabotaged, but did not say who might be to blame.
Russia has denied responsibility.
How much could Nord Stream 1's closure affect Europe?
Last year, Russia was supplying EU countries with 40% of their natural gas.
Germany, Europe's largest economy, was the largest importer in 2021, followed by Italy.Germany, Europe's largest economy, was the largest importer in 2021, followed by Italy.
In 2021, the UK imported 4% of its needs from Russia, and in June this year, it imported no Russian gas for the third month in a row. However, Russia has been steadily reducing supplies.
The US doesn't import any gas from Russia. Over the summer, it drastically cut the amount of gas it supplied through Nord Stream 1, from 170m cubic metres a day to 20m cubic metres.
However, they are affected when Russia restricts supplies to mainland Europe, as this causes global gas prices to rise. It frequently shut the pipeline, citing maintenance work or equipment problems.
What impact are sanctions having? Overall, Russia has cut it supplies of gas to Europe by 88% over the past year, according to David Fyfe, chief economist with research firm Argus Media.
Since February, the EU has imposed a number of sanction packages on Russia, including on its energy industry. This has caused the wholesale price of gas to increase by 210% over the same period.
The Kremlin has said that "technological problems" caused by Western sanctions are preventing Russia from supplying gas via the Nord Stream pipeline. It says a leak has been detected in a turbine. In 2021, the UK imported 4% of its needs from Russia. Nowadays, it imports none.
But a spokesperson for the EU told the BBC the sanctions regime does not affect the technology needed for the transport of gas into Europe. However, gas prices have also soared in Britain because when Russia restricts supplies to mainland Europe, that also creates acute shortages on the international gas market.
Siemens Energy, which produces the gas turbines, said these type of leaks "do not normally affect the operation of a turbine". How can Europe respond to the gas shortage?
"This doesn't seem like a legitimate reason to close a pipeline", says Ben McWilliams, an energy policy expert at Bruegel. "I'm as confident as I can be that this is Putin's latest move to manipulate gas prices and put pressure on Europe's energy systems." Gazprom, the Russian state-backed firm which operates Nord Stream 1, says it is "impossible" to say when it could come back online.
Gazprom has also said missing documents have prevented certain gas turbines being maintained - but Siemens Energy has rejected the suggestion it failed to provide the relevant paperwork. "Russia has created gas shortages as a way of weakening Europe's determination to maintain sanctions against it," says Mr Fyfe.
Russian gas flows through pipelines across eastern and central Europe "This puts further leverage on the Europeans."
The EU has proposed a price cap on Russian gas. President Putin has threatened to cut off all energy supplies if it takes such a step. Europe has become increasingly dependent on supplies of Russian gas
The EU has also said it will cut gas imports from Russia by two-thirds within a year, but has stopped short of a total ban. However, the European Union has said it will cut gas imports from Russia by two-thirds over the coming year.
To help it reach its goal, member states have agreed to cut gas usage by 15% over the next seven months. To help it reach that goal, member states have agreed to cut gas usage by 15% over the next seven months.
There's doubt over where the EU will find alternative supplies, and it may need to ship in liquefied natural gas (LNG) in tankers from producers like the US and Qatar. EU states are also looking to ship in liquefied natural gas (LNG) in tankers from producers such as the US and Qatar.
Energy advisor Kate Dourian says that "there aren't enough LNG terminals in Europe. This will be a problem for Germany, particularly." However, says energy advisor Kate Dourian: "there aren't enough LNG terminals in Europe. This will be a problem for Germany, particularly."
Will Europe run short of oil? What sanctions are being imposed on Russian oil and gas?
The EU has agreed to ban all Russian oil imports which come in by sea by the end of this year. Russia exports about 5m barrels a day of crude oil and about 3m barrels a day of refined oil products. These account for 40% of its total export revenues.
It will allow oil to continue to be imported by pipeline, as a "temporary measure" because countries like Hungary and Slovakia depend on it. EU nations will stop buying Russian crude oil imported by sea from 5 December, and end purchases of Russian refined oil products by sea from 5 February next year.
Some landlocked European countries such as Hungary and Slovakia will get an opt-out because they have no other way of importing oil except via pipeline from Russia.
The UK and US have already banned imports of Russian oil.
The EU also wants to put a cap on the price which other nations will pay for Russian oil, to stop Russia from making big profits.
The precise level of the cap will be decided later, but will affect big importers of Russian oil such as India.
The plan is being backed by G7 nations such as the US and the UK.
The EU and G7 say those which don't obey the cap will not be able to use firms in financial centres like London to insure oil shipments.
President Putin has threatened to cut all energy supplies if it takes such a step, but G7 leaders believe that's a bluff.
Will this leave Europe short of oil?
Some European nations could still have their oil supplies significantly squeezed by the ban.Some European nations could still have their oil supplies significantly squeezed by the ban.
Lithuania and Finland got about 80% of their oil from Russia in November last year, the latest data available. Lithuania and Finland imported about 80% of their oil from Russia in November last year.
How can the world cope without Russian oil and gas?
How can the world cope without Russian oil and gas?
However, EU countries can buy oil from other producers.However, EU countries can buy oil from other producers.
Earlier this year, the IEA - a club of oil importing countries - agreed to release 120m barrels-worth of crude from their stocks, and President Biden ordered a major release of oil from America's reserves.Earlier this year, the IEA - a club of oil importing countries - agreed to release 120m barrels-worth of crude from their stocks, and President Biden ordered a major release of oil from America's reserves.
The US has declared a complete ban on Russian oil imports, and the volume of oil imports by the UK has fallen sharply in the last year.The US has declared a complete ban on Russian oil imports, and the volume of oil imports by the UK has fallen sharply in the last year.
Are sanctions working?Are sanctions working?
Helped by soaring energy prices, Russia received an estimated €400bn ($430bn, £341bn) over the past year from oil and gas exports to Europe.Helped by soaring energy prices, Russia received an estimated €400bn ($430bn, £341bn) over the past year from oil and gas exports to Europe.
David Fyfe of Argus Media says that high global prices of oil have pushed up the amount Russia earns from crude oil exports by 41%.
The EU says its latest sanctions could cut the amount of oil it buys from Russia by 90%. However, this will take months to come into full effect, and even then Russia will be able to sell oil elsewhere in the world.The EU says its latest sanctions could cut the amount of oil it buys from Russia by 90%. However, this will take months to come into full effect, and even then Russia will be able to sell oil elsewhere in the world.
India and China have both been buying more Russian crude in recent months.India and China have both been buying more Russian crude in recent months.
How can the world cope without Russian oil and gas?
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