Europe’s unity is collapsing over Russia sanctions, Germany warns

Europe’s unity over sanctions on Russia ‘is starting to fall apart’, Germany’s economy minister has warned as diplomats point to continuing divisions over a set of sanctions that must be discussed by states members on Monday.

Robert Habeck spoke as EU ambassadors meeting in Brussels on Sunday failed to agree on the bloc’s latest set of sanctions against Moscow, including a plan to halt Russian oil imports that Hungary has been blocking for weeks.

Diplomats had hoped to agree on measures to propose to EU leaders who are due to begin a two-day summit on Monday.

“After Russia’s attack on Ukraine, we saw what can happen when Europe stays together. In view of tomorrow’s summit, let’s hope it continues like this. But it is already starting to crumble and crumble again,” Habeck, who is also vice-chancellor, told reporters in Germany on Sunday.

His comments underscore the EU’s difficulties in finding a way to extend sanctions against Moscow for its war on Ukraine without hurting parts of the European economy that rely heavily on Russian oil and gas supplies.

“Europe is still a huge economic area with incredible economic power. And when united, he can use that power,” Habeck said at the opening of a trade fair.

European diplomats on Sunday tried to unite on a compromise plan to impose an embargo on Russian oil purchases by sea and exempt imports by pipeline, according to three European diplomats. This would cover around two-thirds of European imports of Russian oil, but avoid touching the oil that is flowing to Hungary and other countries, including Germany.

The potential solution is seen as a way to resolve concerns about security of oil supplies that have been expressed by Hungary, Slovakia and the Czech Republic.

“The problems are the same, but the way we try to solve them is different,” said a senior EU diplomat, who added that it could take a few more weeks before a final agreement is reached.

EU diplomats are due to meet again on Monday morning ahead of a European Council meeting in a last-ditch attempt to avoid an acrimonious disagreement at the summit.

Some officials worry that treating Russian crude deliveries differently based on how they enter the bloc could introduce distortions to the oil market.

“Many countries have argued that this is such a complicated economic sector, that we have to be careful to maintain a level playing field,” said an EU diplomat with direct knowledge of the talks. “The legal aspects need to be ironed out, so it may take a little longer,” the diplomat said.

Among the issues that remain to be resolved are the technical adjustments needed for Central European refineries so that they can handle different supplies, as well as the construction and financing of alternative pipelines so that all Russian oil can be subjected to a embargo at a later stage.

The sanctions package being discussed is the sixth proposed by Brussels since the invasion began in February. The EU has already implemented coal sanctions but allowed countries to continue buying gas from Moscow.

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