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28th May 2023

EU warns next winter may be 'difficult for European economy'

  • The 27-member bloc imports over 40 percent of its gas and nearly 37 percent of its oil from Russia (Photo: Jasmine Halki)
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The European Commission has raised concerns over the impact of the cost of heating next winter on the continent's economy.

"We cannot underestimate the gravity of the implications of the invasion of Ukraine for our energy sector and our economy," EU energy commissioner Kadri Simson told a news conference in Warsaw on Tuesday (26 April).

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"We are encouraging member states to be ready for the next heating season which might be very, very difficult for the European economy," she added.

The war in Ukraine has prompted Europe's awakening from Russian fossil-fuel dependency.

And the sixth round of sanctions on Russia in response to the invasion of Ukraine is expected "very soon," Simson said.

Halting energy imports will send a "clear message" to Russia and the EU is currently moving in that direction, she added.

But EU sanctions on Russia, Simson said, also have an impact on the EU economy and the 27-nations bloc should be prepared to cushion supply disruptions in the short term.

Once the proposal is presented to EU ambassadors on Wednesday, the EU Commission will hold a bilateral meeting with member states to find common ground. But the exact date of adoption is still unclear since the EU's sanction regime requires unanimity.

The previous package of sanctions introduced an embargo on coal from Russia, while the upcoming round of sanctions is expected to include some sort of oil embargo.

Germany, which is heavily dependent on Russian energy, is calling for a gradual approach in order to phase out oil imports by the end of the year.

The 27-member bloc imports over 40 percent of its gas and nearly 37 percent of its oil from Russia, while Russian imports accounted for about 19 percent of the EU's coal use in 2020.

With the EU pledging to reduce its imports of Russian gas by two-thirds this year and phase out its energy trade with Moscow by 2027, carbon-intensive coal is getting a lifespan extension.

The Estonian commissioner said it is understandable for some member states to dampen the green transition and prolong the use of coal-fired power plants under the current circumstances.

Poland, which is also one of the main coal producers in Europe, previously said that as many coal plants as possible must be operating in the country to support both Ukraine and the EU's energy system.

But the Polish climate minister Anna Moskva said on Tuesday that it was "too early" to say whether Poland will ask Brussels for the approval to extend support for coal-fired power plants.

"Poland needs stable power sources to complement renewable output, some upgrades of existing units are necessary but there won't be any revolutionary changes to energy policy," she said.

"[Yet] it's too early to say if we will ask for an extension of the capacity market," she added.

EU member states can decide on the structure of their energy mix, although they are obliged by the EU climate law to reduce emissions by 55 percent by 2030 and achieve climate neutrality by 2050.

Threat of EU oil ban already costing Russia

Russia is already losing oil income due to the threat of a future EU embargo and there is no evidence of large-scale sanctions evasion, the EU Commission has said.

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