OPINION
Market Rating Before FOMC MeetingJan 31
EU Implements 6th Sanctions Package Against Russia
Due to the EU's dependence on Russian gas and oil, the Russia-Ukraine war is expected to increase costs in the future. It is known that they have been trying to take concrete steps recently, on the concerns that it will make the EU even more helpless.
The EU member states, which had held talks several times on the issue of sanctions, could not reach a consensus on the new 6th sanctions package, which envisaged the ban on oil imports from Russia. The reason for this was that many EU member states had differences of opinion on their dependence on Russian oil.
First, the EU Foreign Ministers discussed the 6th package of sanctions against Russia in Luxembourg in mid-April, but there was no specific result here. Even though the EU member states, which gathered again in early May, reached an agreement on the 6th sanction package aimed at "stopping the import of refined products by the end of the year" and sent an "embargo" message to Moscow, they could not agree on the whole package. Countries such as Hungary, Slovakia, the Czech Republic and Bulgaria played an important veto role.
Finally, the EU leaders, who came together again at the European Leaders' Summit held in Brussels on 30-31 May, focused on the issue of sanctions. When the dates showed June 2, European Commission President Ursula Von Der Leyen announced that they had reached an agreement in principle on the 6th package of sanctions on Russian energy.
On Friday we left behind, and the EU informed us that the 6th sanctions package has officially entered into force. According to this;
- The assets of some Russian officials, oligarchs, and family members involved in the attacks on Ukraine will be frozen. These people will be banned from travel,
- Oil imports from Russia will be banned,
- By the end of this year, Russia's oil imports will be reduced by 90 percent,
- The provision of services to the Russian oil sector will be banned,
- 3 Russian banks, including Sberbank, and 1 Belarusian bank will be excluded from the international payment system SWIFT,
- The scope of the export ban to Russia is extended,
- A publication ban will be imposed on 3 Russian media organizations engaged in propaganda activities,
- Russia's consulting services will be cut off.
The EU's continuous expansion of sanctions against Russia due to its invasion of Ukraine keeps supply concerns alive in commodity markets. As a matter of fact, crude oil is testing its highest level since March 9 with approximately $119.10 today, while coal is close to its historical high of $428 on May 31. On the other side, wheat prices have regained an upward trend and reached the level of 1085 dollars, after retreating to the level of 1027 dollars.
