Trending

Putin: Europe has no energy alternatives to Russian gas. Weaning off will have dire consequences for economy

Business Insider US
Russian President Vladimir Putin with Russian Defense Minister Sergei Shoigu and Gen. Valery Gerasimov, Chief of the Russian military's General Staff, September 13, 2021.
  • Europe has no viable alternative to Russian energy, warned President Putin.
  • "A reasonable replacement for Europe simply does not exist," Putin said Thursday in a televised statement. 
  • While Russian oil has rebounded, it has had to travel further to find new markets and buyers. 
  • For more stories, go to www.BusinessInsider.co.za.

Russian President Vladimir Putin said Europe doesn't have an alternative to Russian energy, and severe economic consequences will follow if the continent tries to replace its supply of oil and gas from the country. 

"A reasonable replacement for Europe simply does not exist," Putin said Thursday during a televised statement ahead of a meeting on Russian energy. "There are simply no spare volumes in the global market, and deliveries from other countries, primarily the US, which may be sent to Europe, will cost the consumers many times more."

He also noted that there were currently "issues with payments for Russian export energy supplies." 

The Thursday statements follow his call earlier for "unfriendly countries" to purchase oil and gas using rubles, or risk being shut off from Russian energy.

But the European Commission warned this week that EU member states would be in violation of sanctions if they purchased Russian energy using rubles. Doing so would give Russia total control over the transactions and exchange rates, the Commission said.

Still, given the reliance on Russian energy, European governments are weighing how to respond to Putin's demand for ruble payments. 

Russia, for its part, has continued to ship energy resources and oil exports have rebounded. But the sanctioned cargoes have had to travel much further distances in order to find new markets. During the first week of April, Russian crude exports jumped to about 4 million barrels a day — the highest level all year.

Russia is seeking new customers for its resources, Putin told officials earlier this week, as well as exploring ways to increase domestic markets. 

Meanwhile, earlier this week Ukraine called on the world's leading energy traders to stop handling Russian crude. 

"The fact is that traders are trading and they are helping Russia to receive this blood money," President Volodymyr Zelenskyy's adviser told the Financial Times. "They are in this cycle of financing war crimes and genoicide against Ukrainian citizens."

Get the best of our site emailed to you every weekday.

Go to the Business Insider front page for more stories.