EU sanctions have banned the supply of Russian coal and fertilizers.
On August 1, the fifth package of anti-Russian Western sanctions, adopted back in April of this year, came into full force. As part of its implementation, a gradual abandonment of Russian coal was supposed, since August 10, a complete ban on its supply has been in effect.
The precise wording of the document states that the sanctions include the following measures:
a ban on the purchase and import of this natural resource (both coal and other types of solid fossil fuels) from Russia to the countries of the European Union;
a ban on their transmission through Europe.
The prohibitions apply to a natural resource if it originates from the Russian Federation or is exported from the country. Some types of fertilizers and jet fuel were also mentioned in the fifth package of sanctions. Since April, a delay was given on previously concluded contracts, now it has expired.
Statistics on coal exports are provided by both sides. According to the European Union, the Russian budget received about 8 billion euros a year from supplies, according to the Ministry of Energy, European countries last year received about 50 million tons from the Russian Federation (more than 21% of total imports). The same department planned to occupy a quarter of the world coal market by 2050. Now Russia is one of the three leaders in the supply of the resource, second only to Australia and Indonesia.
The European Union has long planned to abandon coal in general and is implementing this policy gradually, the European market is relatively narrow. The fifth package traditionally included personal, transport, energy and trade sanctions.
The EU was also quick to explain the ban on Russian coal and fertilizers, it is quite large-scale. So, export is understood as the service by the EU entities of all operations from the territory of Russia, including transfer, transportation and regardless of the final delivery point. Such a broad understanding of the export ban has already surprised insurers who were counting on limiting the ban only to EU countries, which should not affect destinations outside of it. In addition, it was separately clarified that now shipowners from European countries cannot load Russian coal at all, even if the delivery is carried out to other countries that are not members of the community. It is anticipated that such significant restrictions could cause significant hardship in the industry.
In the meantime, coal consumption is expected to increase in Europe compared to last year.
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