How Germany Plans to Replace Russian Oil and Gas

The euro zone’s largest economy can guarantee the security of supply even without Russian gas or oil. Germany’s Economy Minister Robert Habeck stated that Germany will have to buy more gas, as well as coal, from other countries. 

He also noted that Germany was too dependent on Russian oil and gas. Currently, the country gets half of its gas from Russia. 

Robert Habeck expects oil and gas prices to continue to rise in the short term following Russia’s attack on Ukraine, nonetheless, said he hoped prices will later level off at a manageable level.

Habeck also mentioned the Nord Stream 2 pipeline. He said he didn’t see the pipeline as being able to go online in the short or medium term. 

Oil prices on Thursday

Oil prices rose on Thursday after Russia’s attack on Ukraine worsened concerns about disruptions to the global energy supply. 

The Russian Federation launched an all-out invasion of Ukraine by land, air and sea in the biggest attack by one state against another in Europe since World War Two.

Western countries promised the toughest sanctions on Russia in response. The U.K. and its allies would unleash a massive package of economic sanctions on Russia according to the U.K.’s Prime Minister Boris Johnson. Interestingly, he also said the West must end its reliance on Russian oil and gas. 

At least several major buyers of Russian oil were unable to open letters of credit from Western banks to cover purchases on Thursday. 

Brent crude advanced $8.15 or 8.4% to $104.99 a barrel as of 12:21 GMT, having touched a high of $105.79. U.S. West Texas Intermediate (WTI) crude gained $7.33 or 8% to $99.43. Brent crude and WTI crude reached their highest since August and July 2014 respectively.

Furthermore, Russia is the largest provider of natural gas to Europe, providing about 35% of its supply.