Germany has been the largest customer of Russian energy of any country during the first two months of the invasion of Ukraine, a study has found.
The study, Financing Putin’s War on Europe, from the Centre for Research on Energy and Clean Air (CREA) found that in total, Russia has taken in €63 billion ($66.5/£53.5 billion) in exchange for oil and natural gas exports since launching its invasion of Ukraine on February 24th.
Germany represented by far the largest consumer of Russian energy according to the study, which claimed that Germany handed over €9.1 billion ($9.65/£7.75 billion) to Moscow since the beginning of the invasion. The next largest buyers were Italy at €6.9 billion and China with €6.7 billion during the same time span.
Germany has come under considerable scrutiny both at home and abroad as the war in Ukraine has exposed its reliance on Russia economically and therefore hampering its ability to act meaningfully on the world stage.
The scandal has also exposed the folly of Germany’s green agenda, which has been unable to fulfil its energy demands. The economic powerhouse of Europe is now facing warnings of a potential recession, should Russia shut off the taps, as it has already with Poland and Bulgaria for their refusal to pay Moscow in rubles rather than Western currency.
On Thursday, Uniper, one of the largest energy firms in Germany, said that it had no choice but to comply with Putin’s demands of paying in Russian currency. However, the firm, said that it will be paying initially in Euros which will then be transferred into rubles by their Russian counterparts in order to fall in line with Western sanctions on the central bank of Russia.
“We consider a payment conversion compliant with sanctions law and the Russian decree to be possible,” a Uniper spokesman told the BBC.
“For our company and for Germany as a whole, it is not possible to do without Russian gas in the short term; this would have dramatic consequences for our economy.”
The scheme currency transfer scheme was first proposed by the European Commission last Friday as a means of EU firms from falling afoul of sanctions imposed by the bloc, and indeed the U.S. and UK.
As a whole, the European Union accounted for 71 per cent of Russian energy exports, sending €44 billion to Moscow, according to the study from the CREA.
Commenting on the findings, the group said: “Fossil fuel exports are a key enabler of Russia’s military buildup and brutal aggression against Ukraine,” going on to urge Europe to end its reliance on Russian energy.
Germany has hitherto been reticent to send significant arms to Ukraine. However, this week, German lawmakers approved the shipment of “heavy weapons and complex systems” to Ukraine. Yet, leftist German Chancellor Olaf Scholz drew criticism for not being in Berlin for the vote and his previous hesitancy of sending weapons to Ukraine.
Despite now committing to arming the Ukrainians, it is likely that Germany will continue essentially paying for the Russian war effort, as it currently has no announced plans to cut off Russian natural gas and has merely committed to ending oil imports by the end of 2022.
Follow Kurt Zindulka on Twitter here @KurtZindulka
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