In an op-ed in the New York Times, Oleg Ustenko, an economic adviser the the president of Ukraine, says that the Europeans a talking a good game in terms of their support for his country but not delivering as much as they could—for one thing they’re continuing to buy oil and gas from Russia:
Shutting down Mr. Putin’s cash flow is an urgent moral and strategic imperative, but Europe is frozen in the headlights.
Some European experts claim that the war is not being financed by energy exports. This is entirely wrong. Mr. Putin’s regime is seeking to buy military equipment. With much of the central bank’s reserves frozen, Mr. Putin needs the hard currency he receives every day, and therefore Russia has continued to pump oil at full prewar capacity. The euros that Mr. Putin receives now goes directly toward firepower that kills Ukrainian civilians and destroys our cities.
The economic and energy minister of Germany, Europe’s largest economy, said that any reduction in current purchases of oil and gas would cause his country’s economy to crater.
But Europe already has enough gas to get to next winter, and the International Energy Agency has laid out a viable plan for conservation and alternative supplies, which would reduce European imports of Russian gas by more than one third. Germany is particularly dependent on Russian gas, but a study from the German National Academy of Sciences Leopoldina pointed out that a short-term suspension of Russian gas would be “manageable.†Additionally, given that Germany has low debt relative to G.D.P., the potential effects on lower-income people can be addressed.
In the meantime, payments for Russian gas should go into escrow accounts, so that the proceeds cannot be used to buy weapons. This is standard practice when there are sanctions. Russia has already imposed its own escrow requirement on foreign investors who receive coupon payments on their ruble-denominated corporate bonds.
He should get used to it. Our European allies write a heckuva press release. They remind me of the W. C. Fields line: “Giving up drinking is easy—I’ve done it hundreds of times.” They announced their intention of eliminating their use of fossil fuels completely by 2030. Don’t be surprised if they make another announcement that they’ll eliminate their use of fossil fuels by 2040.
In a similar vein Brahma Chellaney writes at Project Syndicate:
Despite the raft of financial and economic sanctions it has imposed on Russia, Europe continues to support the Russian economy’s mainstay: oil and gas exports. This undermines the West’s own mission, especially as the confrontation drives up energy prices. But Europe’s longstanding dependence on Russian energy supplies has left it with no good alternatives – at least for now.
Such a tradeoff may not arise in the future. The European Union has already vowed to eliminate its dependence on Russian energy by 2030. At the same time, countries that want to uphold trade ties with Russia are seeking solutions outside Western-controlled channels. For example, India is buying Russian oil with rupees. Similar moves elsewhere – for example, Saudi Arabia is considering renminbi-based oil sales to China – threaten to erode the US dollar’s global supremacy.
concluding:
International law may be powerful against the powerless, but it is powerless against the powerful. The League of Nations, created after World War I, failed because it could not deter important powers from flouting international law. Its beleaguered successor, the United Nations, may be facing a similar reckoning. How can the UN Security Council fulfill its mandate of upholding international peace and stability if its five veto-wielding permanent members are arrayed into two opposing camps?
The world is headed for an era of greater upheaval. However it plays out, the pretense of a shared commitment to international law will be the first casualty.
Don’t expect the Europeans to acknowledge that. They’re willing to defend the rules-based order to the last Ukrainian.
