EU Ban On Russian Oil Likely To Disrupt Supply, Hike Prices: Germany

German Economy Minister Robert Habeck said on Wednesday that a gradual EU ban on Russian oil imports could lead to supply "disruptions" and price increases but backed the measure as necessary step to sanction Moscow.

"I have said a few times that we can of course not guarantee in this situation that there won't be disruptions, primarily regional disruptions," he told reporters after a cabinet meeting.

He stressed, however, that Berlin backed the bloc's measure as a response to the Ukraine invasion.

Habeck, whose brief also includes energy policy, cited specifically the PCK refinery in the eastern town of Schwedt as one that could feel the impact.

It supplies around 90 percent of the oil consumed in Berlin and the surrounding region, including Berlin-Brandenburg international airport.

Russian oil giant Rosneft, controlled by the Kremlin, is a majority shareholder in the site -- a complicated situation Habeck said would have to be "resolved politically".

Habeck noted that the gradual implementation of the ban should help cushion shocks to oil markets.

"It is possible they have already been priced in," he said.

"But of course prices could also significantly rise."

The European Union's executive unveiled on Wednesday plans for a gradual ban on Russian oil imports as part of a raft of new sanctions to punish Moscow for invading Ukraine.

If approved, the oil ban would be the EU's toughest move yet against Russia's strategic energy sector that helps the Kremlin finance its war, but will still not touch its huge gas exports.

The embargo is part of the bloc's sixth sanction package, and would be phased-in over the rest of the year to help countries adapt.

Germany has ruled out an immediate embargo on all Russian energy, especially gas. But it aims to end Russian oil imports by the end of this year.

Russian supplies now make up 12 percent of Germany's oil imports compared to 35 percent previously, according to data provided by the economy ministry on Sunday.

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