On the anniversary of the criminal invasion of Urkaine by Russia, what is the balance of a year in sanctions?
On a presentation to my then @europarl colleagues on February 27th, I argued in favor of:
"Do it all
Do it hard
Do it now"
?s=20
1/10
RT @lugaricano: Today we had a meeting of @RenewEurope to discuss Ukraine. I share here a few proposals on #EconomicWarfare I prepared for the Group to discuss (link at end).
Given the failure of Putin´s initial plans, …
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977367568855045
The first sanctions, on oligarchs and central bank assets, were fast and painful for Russia.
However, the EU chose to continue importing oil and gas. Hence Russia could withstand the initial shock.
Here was my assessment on March 8th.
2/
https://www.youtube.com/watch?v=85Oun3jq1F0
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977370320326657
Russia has financed the war Russia with its exports of oil and gas:
- $160bn in revenue in 2022
- a 28% ($36.5bn) increase vs 2021
- 45% of total Russian government budget.
We can only imagine what immediate harsh sanctions would have accomplished
3/
https://www.aa.com.tr/en/economy/russian-budget-revenue-from-oil-gas-industry-grew-28-in-2022-official/2788859
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977372937482240
But now sanctions are mostly in place:
1. An Oil embargo by the EU and an oil price cap from the G7 are (finally!) very significantly reducing Russia's oil revenue - it is selling its oil at a $30 discount versus Brent.
4/
?s=20
RT @AsstSecEcon: The price cap lowers Russian oil revenues in two ways:
1. Locking in a price ceiling for any trade using coalition services.
2. Providing leverage to buyers of Russian oil—including sales outside the cap—shown by the grow…
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977375709917184
2. As a sign that the cap is hurting, Russia has announced it would cut its oil exports in 625000 barrels per day in March.
5/
https://www.reuters.com/markets/commodities/russia-plans-deep-march-oil-export-cuts-sources-2023-02-22/
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977378457186304
What has been the impact of Putin's gas weapon? Parlty due to luck (good weather, Zero Covid in China), the Eurozone avoided a recession in Q3 and Q4
https://www.ft.com/content/004faaeb-52d2-4b93-aaf7-01b5a9531a90
7/
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977383683358722
But it is not just luck. As @ben_moll @BachmannRudi and I an others argued during 2022, modern economies are much more resilient than engineers and politicians believe. Covid showed it and the war again. Unimagined substitution possibilities are many.
8/
?lang=en
RT @ben_moll: Thread: a collection of concrete cases of substitution & demand reduction in the energy crisis.
Economic theory predicts that, as prices rise, households & firms reduce demand and substitute…
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977386665480197
The most important of these has been renewable energy. Renewable energy capacity in the EU is projected to double in 2022-2027. The war has a lot to do with it: since 2021 the forecast has been revised by almost 40% in the EU.
https://www.iea.org/topics/russias-war-on-ukraine
9/
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977389433761793
Now, the West has to remain united behind Ukraine. We have done a lot, but always too late. It is still true, as it was on February last year, that many lives can be saved if we are willing to incur sacrifices to reduce Russian oil and gas revenues.
Slava Urkaini.
10/10
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977392784908288
3. Even though there are no gas sanctions officially, the EU imported in Jan 80% less gas from Russia than last year
6/
https://www.bruegel.org/dataset/european-natural-gas-imports
🐦🔗: https://n.respublicae.eu/lugaricano/status/1628977380856418306