As President Vladimir Putin continues to wage war on Ukraine, causing one of the world’s greatest humanitarian crises, President Joe Biden announced a ban on Russian fuel, hoping to cripple the “main artery of Russia’s economy.”
“We’re banning all imports of Russian oil and gas energy. That means Russian oil will no longer be accepted in U.S. ports, and the American people will deal another powerful blow to Putin’s war machine.”
While the US used an abrupt approach because its dependency on Russian fuel is less, the European Union is planning to cut its reliance on Russian gas by two-thirds this year and end it “well before 2030”.
What it means
The ban on Russian oil will automatically further spike gas prices, where consumers are already seeing a surge at the gas pump.
At the onset of the Russia-Ukraine conflict, Paul Hepburn, a proprietor of three Esso Gas Stations warned that Bahamians can expect to pay $6 a gallon, while Foreign Affairs Minister Fred Mitchell estimated $8 a gallon.
The big story
Ten percent of the world’s fuel comes from Russia, so if dealers source fuel from other places, the demand will cause the price of fuel to increase.
“We think that a complete ban on Russian energy imports would cause the prices of Brent crude oil and European natural gas to surge to $160 [per barrel],” economists at Capital Economics said in a research report.
Russia is the EU’s top gas supplier.
What Biden says
The president said he made the decision in consultation with European allies but they may not be in a position to join the ban. He said the United States is working closely with them to develop a “long-term strategy” to reduce their dependence on Russian energy.
