by Michael Brand
Unity. When wars are fought, they are won or lost based on unity. Keeping your people unified behind your troops and the war effort. Keeping your allies unified in ensuring that they give your country the resources necessary to keep the war effort alive. Keeping your army and allies united on all fronts even the non-combat ones. In an act of unity and support for Ukraine the European Union has committed to passing an embargo of 90% of Russia oil by the end of year.
Originally the EU wanted to ban all imports of Russian oil, but President of Hungry, Viktor Orbán, objected as “Hungary receives more than 60% of its oil from Russia via a pipeline” (Schmitz). Orbán has shared a long history of ally-ship with Putin, using similar authoritarian tactics to the dictator to ensure he stayed in office. Hungary stood as the only country unwilling to sign on to a complete ban of Russian oil, causing the EU to give them an exemption to ensure that a deal was made.
The embargo will have a minimal effect in the short term, as European countries will have to rely on Russian oil during the transition away from it. However in the long term, the embargo will have a monumental effect as it, “could cause Russian production to drop another one million barrels a day, or about 10 percent, once the restrictions come into effect. The downturn would contribute to what many analysts expect to be a broad erosion in Russia’s energy industry in coming years, as major oil companies quit the country and sanctions curb imports of Western technology” (Reed). A crippled Russian economy would be a huge win for Ukraine, as it would become harder for Russia to sustain internal unity and support for the war.
Although the embargo is a strong unified step in support for Ukraine, it does not come without risk. As European economies attempt to rebound a Covid induced recession, the embargo serves as a speed bump in the recovery effort. Europe’s search for oil away from Russia has “driven the price of high-quality crudes produced from West Africa to Azerbaijan to levels not seen for years” (Wallace and Kantchev). The high cost of oil and energy could have dire consequences as Jonathan Hackenbroich, a policy fellow at the European Council on Foreign Relations explains, “factories would have to curb production or even close. Some key industries could be lost forever” (Alderman). Without fuel for key industries or strong economies, it will become harder for allies to stay unified behind Ukraine, as it is hard to fuel a war effort without the resources to do so.
The embargo is a risky but monumental step in support for Ukraine. Even with the Orbán exception, the ripple in Russia’s economy may be enough to sway public support in Russia against Putin and the war effort. However, the embargo still serves as a major risk to European economies, a severe enough risk that countries like Germany and Poland may pull out of the agreement to save their factories. The consequences of the ban, for both sides, will depend on one thing: unity. If Russia is able to keep its people united behind the war effort in spite of the hit to the economy, the embargo will have little to no effect. If the EU is able to stay committed and united behind the embargo, it may have a truly monumental one.
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