Alex Lantier & Johannes Stern
Yesterday, at the European parliament in Strasbourg, European Commission President Ursula von der Leyen called for an EU embargo on Russian oil to crush Russia’s financial system.
As Washington and its European NATO allies pour tens of billions of dollars of arms into Ukraine, risking total war with Russia, the EU is waging economic war on Russia and on the working class. An embargo would devastate both Europe and Russia: the EU imported $147.8 billion in energy from Russia last year, including $104.4 billion in crude and refined oil. Even if the EU successfully arranged alternative deliveries of oil, such an embargo would produce a surge in energy prices and massive job losses and economic hardship across Europe.
Von der Leyen announced multiple punitive measures. New EU sanctions target “high-ranking military officers and other individuals” including Patriarch Kirill, the head of the Russian Orthodox Church. The EU will ban Russian broadcasters from its airwaves and remove three Russian banks, including Sberbank, Russia’s largest bank, from the SWIFT system for international dollar-denominated transactions.
The EU’s goal, von der Leyen said, is “the complete isolation of the Russian financial sector from the global system.”
She called to ban financial and public relations services to Russia: “the Kremlin relies on accountants, consultants and spin doctors from Europe. And this will now stop. We are banning those services from being provided to Russian companies.” Europe’s spin doctors, it appears, are to be employed exclusively in promoting NATO and EU policy.
On the oil embargo, she said, “it will not be easy. Some Member States are strongly dependent on Russian oil. But we simply have to work on it. … We will make sure that we phase out Russian oil in an orderly fashion, in a way that allows us and our partners to secure alternative supply routes and minimizes the impact on global markets. This is why we will phase out Russian supply of crude oil within six months and refined products by the end of the year.”
She finally called for an “ambitious recovery package” of economic reconstruction to “pave the way for Ukraine's future inside the European Union.” She ended by calling out “Slava Ukraini,” the battle cry of the Nazi-collaborationist Organization of Ukrainian Nationalists (OUN) during World War II and of far-right Ukrainian-nationalist militias that are fighting Russia today.
Her speech triggered a sharp rise in oil prices yesterday, up 5 percent to $107.81 per barrel in New York and $110.14 in London. Russia for its part is shipping oil to India and China and urgently building more overland pipelines to China. New projects include a pipeline from Sakhalin island via Vladivostok and the “Soyuz Vostok” pipeline via Mongolia to China. Russia is also planning inter-connector pipelines to redirect gas previously exported to Europe eastwards to China.
The EU oil embargo is economically suicidal, and EU officials are well aware that they are setting into motion a confrontation with the working class. In March, German Economy Minister Robert Habeck warned that the dislocation caused by an embargo would provoke mass strikes and protests. “I wouldn’t support an embargo on imports of fossil fuels from Russia,” he said. “I would even speak out against it, because we would threaten the social peace in the republic with that.”
Before von der Leyen’s speech yesterday, however, Habeck said Germany has made “great progress” in finding alternatives to Russian oil, though “other countries may need more time.”
The oil embargo, which EU member states must unanimously agree on, faces opposition. Hungary and Slovakia, both dependent on Russian energy, have warned that the one-year exemption the EU is offering them is insufficient. Hungarian government spokesman Zoltan Kovacs said, “We do not see any plans or guarantees on how a transition could be managed based on the current proposals, and how Hungary’s energy security would be guaranteed.”
On Tuesday, Hungarian Foreign Minister Peter Szijjarto said Hungary would oppose sanctions “that will make the transport of natural gas or oil from Russia to Hungary impossible. … It is currently physically impossible for Hungary and its economy to function without Russian oil.” Yesterday, however, he said he could support the embargo if Russian crude oil exports to Hungary were exempted.
Slovak Deputy Economy Minister Karol Galek supported action against Russia but asked for three years’ delay before the embargo begins. He warned that an embargo would cripple Austria, the Czech Republic and Ukraine: “This will destroy our European economy.”
Von der Leyen’s speech shows that though the embargo is economically suicidal, the leading EU powers are pushing for it. The NATO alliance is recklessly escalating conflict with Russia, with utter contempt for the lives and well-being of workers across Europe.
The EU is abandoning its concerns at war with Russia. As recently as April 22, German Chancellor Olaf Scholz told Der Spiegel that everything must be done “to avoid a direct military confrontation between NATO and a highly armed superpower like Russia, a nuclear power.” He said it was a matter of “preventing an escalation that would lead to a third world war.” Now, Germany and the EU are taking measures directly posing the risk of a nuclear Third World War.
The EU, which already in mid-April had pledged €1.5 billion in arms to Ukraine, is accelerating arms deliveries. Newly re-elected French President Emmanuel Macron has pledged to send Caesar artillery systems and Milan anti-tank missiles.
After a two-day closed-door German government meeting in Schloss Meseberg, Chancellor Olaf Scholz boasted: “We have supplied from Bundeswehr stocks and are always looking at what else is possible … We have made sure that there is a list of arms deliveries that we have coordinated with industry.”
Against the Russian offensive in the Donbass, where “air defense now plays a role,” he added, “We have therefore said that we will supply up to 50 Gepard tanks suitable for this purpose. We've also said that we want to provide the support, together with our allies, that artillery can be deployed.”
Berlin plans to deliver Howitzer-2000s to Ukraine. German Defense Minister Christine Lambrecht said Berlin has “made the decision” to train Ukrainian fighters on these howitzers, which the Netherlands are supplying. A March 16 expert report from the Bundestag's Scientific Service found that training Ukrainian soldiers on German soil constitutes war participation under international law.
The EU is demanding that the billions of euros for war with Russia be taken from the workers. Speaking after the Meseberg retreat, German Finance Minister Christian Lindner left no doubt that the German and European working class is to be made to pay.
“In view of inflation,” he stressed, “we will also have to adjust questions of financial policy in Germany and Europe.” Because of what he called “the changed financial possibilities of the state,” Lindner opposed anything that could “additionally drive up prices—for example, subsidies—or curtail the European Central Bank’s scope for action, namely by placing members of the monetary union deeper in debt.”
The working class is increasingly driven into struggle by social attacks and skyrocketing energy and food prices. Recent weeks have seen warning strikes by nurses and educators in Germany, a massive truck drivers' strike in Spain, protests in France after the presidential election, and postal workers’ strikes in Britain, among others.
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