Russia Deputy Prime Minister Alexander Novak has said that a continual ban on Russian oil would invite severe consequences for the world market. He hinted that the prices could simply double to reach $300 a barrel.
The United States has been mulling over a possible ban with allies as a form of retaliation for Russia’s invasion of Ukraine.
The initiative was rejected by Germany and the Netherlands on Monday.
Europe, which gets about 40% of its gas and 30% of its oil from Russia, has no readily available alternatives if deliveries are disrupted.
In an interview on Russian state television, however, Mr Novak said that finding a replacement for Russian oil on the European market would be “very difficult.”
“It will take years to complete, and it will be more expensive for European customers. In the end, they will be the most harmed by this conclusion,” he continued.
Germany’s decision last month to suspend Nord Stream 2 certification, a new gas pipeline that would connect the two countries, he said an oil embargo might be met with retaliation.
Russia is the world’s top natural gas and second-largest crude oil producer, and any move to penalize its energy sector would have a significant negative impact on its economy.
Ukraine has pushed for a worldwide ban on cultivation, but there are worries that it would raise prices. At one point on Monday, the price of Brent crude oil rose to $139 a barrel, which is its highest level for almost 14 years.
The average price of petrol in the United Kingdom has hit a fresh all-time high of 155 p per liter. In Asia trade on Tuesday, prices for West Texas Intermediate crude – the worldwide oil benchmark – increased by 3.7% to more than $127 a barrel.
The Reuters news agency reported that the United States is considering pushing ahead with an embargo without its allies, despite only obtaining 3% of its oil from Russia.
The chancellor, however, rejected the notion on Tuesday, saying that Europe had “purposefully” excluded Russian energy from sanctions because its supply could not be secured “any other way” at this time.
Despite all of this, the Western world has made a decision to reduce its dependency on Russian hydrocarbons over time, and some Western firms have boycotted Russian shipments or pledged to divest their interests in Russian energy firms.
According to Mr. Alexander Novak, the sanctions are already having an impact on Russian businesses, despite their compliance with European energy requirements and fulfilling all of their contract obligations.
“We are alarmed by the talk and statements we’re hearing about a potential oil and petrochemical embargo, as well as their phasedown,” he continued.
Mr. Zakharchenko’s statement was made as the third round of peace talks between Ukraine and Russia in Belarus got little forward movement.
In the first two weeks of April alone, more than 1.7 million Ukrainians fled to Central Europe as a result of the conflict, according to the United Nations refugee agency. More than 1 million have arrived in Poland.
If Ukraine chose to cease fighting, changed its constitution to declare neutrality, and recognized Russia’s occupation of Crimea and separatist states’ independence, Moscow would cease operations immediately.
Despite the fact that modest progress has been made in agreeing supply logistics for the evacuation of people, according to a Ukrainian negotiator, things have remained largely unchanged.