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ENERGY

Germany ‘supports Russian oil embargo’, says minister

After weeks of scrambling to reduce its energy dependence on Russia, Foreign Minister Annalena Baerbock has said that Germany would support an embargo on Russian oil.

Foreign Minister Annalena Baerbock
Foreign Minister Annalena Baerbock (Greens) speaks in the Bundestag on April 27th, 2022. Photo: picture alliance/dpa | Christophe Gateau

Speaking on ARD on Sunday, Baerbock said Germany was now prepared to manage without Russian oil for several years due to a number of new supply contracts arranged in the past few months. 

A few weeks ago, it would not have been possible to endure an immediate supply stop, she said. 

Since the beginning of the Russian war against Ukraine, Germany has been scrambling to diversify its energy supply and move away from Russian oil, gas and coil.

According to the government’s latest progress report on energy security, it has managed to cut its dependence on Russian oil from 35 percent to 12 percent in a matter of weeks.

With a German yes to an oil embargo, pressure is growing on the remaining EU member states, including Hungary, Austria and Italy, who are believed to be reluctant to support the move.

According to reports in the Wall Street Journal, officials are expected to make a decision later this week. 

However, questions still remain about the timescale of a potential trade ban and whether it would involve tariffs or caps to limit further price hikes. The United States is reportedly pressing EU states to avoid any measures that would lead to a long-term rise in energy costs.

READ ALSO:  ANALYSIS: How badly would a Russian gas embargo hurt ordinary Germans?

‘No agreement’

Speaking to representatives of small- and medium-sized businesses on Monday, Economics Minister Robert Habeck claimed there was “still no agreement” on an oil embargo within the EU.

Germany could support an oil embargo, he said, but “other countries are not yet ready.” 

He said that the move wouldn’t leave Germany unscathed and could potentially lead to price hikes, but would no longer lead to an oil crisis, as would have been the case a month ago. 

The ministers’ statements mark a major shift in the government’s previously cautious stance on a trade ban for Russian energy supplies.

Previously, the traffic light coalition government, made of the Social Democrats, Greens and Free Democrats, had set a deadline of late summer to halve oil imports and had pledged to end them entirely by the end of the year. Gas imports from Russia, which currently make up around 55 percent of Germany’s gas supply, are likely to continue until 2024. 

Europe’s heavy reliance of Russian energy has been in the spotlight since the country launched its full-scale invasion of Ukraine on February 24th, with Germany facing particularly heavy criticism over its opposition to an immediate embargo.

According to a study by Brussels-based think-tank Bruegel, the bloc sends over €1 billion to Russia’s state-owned energy companies every day, dwarfing the amount of aid that has been sent to Ukraine since the start of the war. 

Last Tuesday, the Kremlin announced that it would end all gas supplies to Poland and Bulgaria after both countries refused to comply with a demand to pay for their energy in rubles, sparking fears that this could be a precursor to shutting off supplies to other EU states. 

READ ALSO: Germany slashes growth forecasts amid Ukraine war

“This has to be taken seriously,” Economics Minister Robert Habeck said on Wednesday, stressing that Germany would continue to make its payments in euros or dollars and that the Russian supplier, Gazprom, would have to convert the money itself.

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ENERGY

‘Over half’ of Germans heating homes less or not at all

High energy costs are changing the heating habits of people in Germany. According to a recent survey, one in ten people didn't turn on their heating or oven at all in September, October or November this year.

'Over half' of Germans heating homes less or not at all

The Ukraine conflict and the economic sanctions against Russia have been driving up the prices of natural gas and oil for months and causing energy costs in Germany to rise rapidly.

As well as introducing several financial relief packages to help people struggling with rising energy costs, the German government has been encouraging people to use energy in their homes more sparingly. 

A recent study conducted by the opinion research institute YouGov on behalf of the news agency DPA seems to show that many consumers are heeding the government’s call to save energy, and that the situation is having an impact on the way that people in Germany use heating in their homes. 

READ ALSO: German households to receive relief for gas costs ‘starting in January’

According to the survey, ten percent of respondents had gone without heating their homes in the current autumn season and had still not turned on their stove or heating by the end of November, despite wintry temperatures and snow in some areas of the country.

Over the winter months, rented properties in Germany have what’s known as a Heizperiode meaning “heating period”, which is usually from October 1st to April 30th. Normally, tenants in Germany are obliged to keep their homes heated to a minimum level to prevent mold and disrepair.

But Germany’s Energy Saving Ordinance, which was brought into force this year as a result of the energy crisis, means that from September 2022, minimum temperatures in rental agreements no longer apply and tenants are allowed to heat less if they want to save on their energy costs.

READ ALSO: EXPLAINED: When should I turn on my heating in Germany this year?

The vast majority (90 percent) of respondents to the survey said they had already used the stove or heating system by the end of November – but had noticeably changed their heating behaviour: 68 percent are heating less than in the same period last year, while around half are heating significantly less.

More than one in two (56 percent), on the other hand, turn down the central heating to save money. Twenty percent heat less because of higher outside temperatures, and 15 percent want to contribute to the security of energy supply by reducing the amount they heat their homes. 

Financial benefits from energy saving

Those who save energy in Germany will also be rewarded by some of the coalition government’s forthcoming relief measures.

The state will cover gas bills for households and small businesses for December and the amount of relief people will get will be based on previous usage, rather than actual usage.

READ ALSO: EXPLAINED: How Germany plans to pay people’s gas bills in December

If people reduce their consumption by 20 percent, for example, they’ll not only get their monthly payment waived but will also receive deductions on future bills as well, or a credit from their gas provider. 

Energy savers will also benefit from the electricity and gas price brake due to come into force in March 2023. The price will be capped for 80 percent of consumption, while the normal market price will be payable for the remaining 20 percent. Therefore those who save energy will benefit.

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