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Oil embargo against Russia: "High price jumps" - experts paint a bleak scenario

2022-05-04T12:01:24.545Z


Oil embargo against Russia: "High price jumps" - experts paint a bleak scenario Created: 05/04/2022, 11:40 am By: Lisa Mayerhofer PCK refinery in Schwedt: The location near Berlin supplies large parts of eastern Germany. The oil comes directly from Russia. © Patrick Pleul/dpa The EU Commission sets the course for an oil embargo against Russia. In Germany, fuel could now be scarce in some areas


Oil embargo against Russia: "High price jumps" - experts paint a bleak scenario

Created: 05/04/2022, 11:40 am

By: Lisa Mayerhofer

PCK refinery in Schwedt: The location near Berlin supplies large parts of eastern Germany.

The oil comes directly from Russia.

© Patrick Pleul/dpa

The EU Commission sets the course for an oil embargo against Russia.

In Germany, fuel could now be scarce in some areas.

Brussels – Brussels is increasing the pressure on Russia.

According to plans by the EU Commission, Russian oil supplies to the European Union are to be largely stopped by the beginning of next year.

EU Commission President Ursula von der Leyen admitted that the planned oil embargo against Russia will require great efforts from some countries.

"Let's not fool ourselves: It won't be easy," she said on Wednesday morning in the European Parliament in Strasbourg.

"Some member states are heavily dependent on Russian oil." The new support for Ukraine could be expensive for consumers and the German economy.

Oil embargo against Russia: high price jumps, but no "oil crisis"

Federal Minister of Economics Robert Habeck (Greens) expects high "price jumps".

One of the reasons is that Russian oil must be replaced by probably more expensive alternatives from other countries.

In addition, the conversion of refineries and delivery routes means effort and costs.

After all, no "oil crisis" is to be expected even without Russian deliveries, said Habeck.

According to him, the share of Russian oil in German consumption has fallen from 35 to 12 percent within a few weeks.

The remaining share of Russian oil of twelve percent is therefore attributable to Schwedt an der Oder in Brandenburg.

Oil embargo against Russia would hit Schwedt hard in Brandenburg

There is the PCK refinery operated by the Russian state-owned company Rosneft, which has so far been dependent on Russian oil supplies.

1200 people are employed directly in the factory, as well as hundreds of employees at suppliers and service providers on the site.

The refinery plays an important role in the region: north-eastern Germany gets 90 percent of its fuel from Schwedt, reports

Bild

, citing Frank Umbach, an energy security expert.

The kerosene for the planes at Berlin Airport BER is also supplied from there.

In the medium term, Schwedt could replace Russian oil via the ports of Rostock or Danzig.

According to Umbach, however, that would not be enough in the short term.

In principle, the German economy could cope with an oil embargo, "but not immediately," he was quoted as saying by

Bild

.

In Berlin and Brandenburg, fuel could run out completely, Habeck even warned loudly

the newspaper.

"If we have no way of catching that, there will be an interruption in delivery," said the minister on ARD.

Oil embargo against Russia: BER Airport is relaxed

At BER Airport, on the other hand, people are relaxed.

According to the Berliner Zeitung

, the airport sees itself

primarily as a service provider, with the airlines managing their own fuel supply.

“Kerosene comes to BER by rail in tank wagons.

This means that the airport can be supplied from all directions - including via the international port of Rostock," BER spokeswoman Sabine Deckwerth told the newspaper.

Deliveries are already coming not only from Schwedt.

And how is the situation developing in the rest of Germany?

Hardly anyone dares to predict when and to what extent refueling or heating will become more expensive.

The petroleum trade association Fuels and Energy was very vague: it was “rather unlikely” that there would be no impact on prices at gas stations.

But the market and price development depend on many factors, such as the dollar exchange rate and the decisions of the major producing countries.

The Federal Association of Consumers did not give a concrete assessment either.

"Nobody can reliably predict how prices will develop after an oil embargo decision," said vzbv mobility expert Marion Jungbluth of the German Press Agency.

“The oil market has always been sensitive and prices volatile.

Oil embargo against Russia: Experts warn of further price increases

However, many experts tend to believe that it will become more expensive: Commodity analyst Ulrich Leuchtmann from Commerzbank, like Habeck, expects higher oil prices.

"Consumers have to adjust to high energy prices," he told

Bild

.

Manuel Frondel, energy expert at the RWI-Leibniz Institute for Economic Research in Essen, also expects sharp price increases in the

Rheinische Post

: "An oil embargo should probably cause petrol prices to rise again significantly in the short term, but a possible embargo should partly affect the current prices already be priced in.

Permanent petrol price heights of three euros per liter should be rather unlikely," said Frondel.

With material from the dpa

Source: merkur

All news articles on 2022-05-04

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