Pump prices, technical constraints: a possible European embargo on Russian oil, under discussion for long weeks in Brussels, would have costly consequences for consumers and businesses, warns Cepii in a note published on Wednesday.
If Europe turns away from Russian oil in reaction to the war in Ukraine, "
it will be necessary to replace a little more than a quarter of the total imports
" of black gold from the continent, warns the Center for Prospective Studies and Information International, an organization attached to Matignon.
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Indeed, 30% of European oil imports come from Russia and 40% of oil product imports come from Moscow, according to Cepii, hence the need to diversify European hydrocarbon supplies, for example by turning to Saudi Arabia, Brazil, the United States or Canada.
But these major oil powers are geographically further from Europe than Russia and the diversification of European supplies will therefore result in higher transport costs, warn the authors of the note.
Technical constraints
Convincing these new partners to increase their production to meet European oil demand could also be tricky.
For Cepii, the contract signed in mid-March by Russia with Indian companies at a discounted price of 25 dollars per barrel is also a “
message
” addressed to other major oil producers.
"
The signal transmitted by Russia is that it will not hesitate to cut prices if they were to increase their production
" to satisfy European desires for diversification, analyze the researchers.
Finally, “
it is important to consider the quality of the crude oils
” that Europe could import in the future.
"
Russian oil having good qualities for producing middle distillates (diesel), replacing it with another oil could require more complex treatment in the refinery to obtain the same finished products
", points out Cepii.
“
The price of petroleum products should therefore increase under the effect of these technical constraints, independently of the interplay of supply and demand
,” he concludes.
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The memo comes as members of the European Union have been trying for several weeks to agree on an embargo on Russian oil imports.
Despite the reluctance of Hungary, in search of guarantees on the maintenance of its supply, an agreement on an embargo is possible “
within a few days
”, estimated Monday the German Minister of Economy Robert Habeck.