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UK to phase out Russian oil imports by the end of the year - Perthshire Chamber of Commerce

UK to phase out Russian oil imports by the end of the year

The UK Government will phase out imports of Russian oil by the end of the year in response to Russia’s invasion of Ukraine.

Business and Energy Secretary Kwasi Kwarteng confirmed that the phasing out would not be immediate, which will enable the UK to adapt its supply chains, in order to support industry and consumers.

Russian imports account for around 8% of the UK’s annual demand and the government will now look towards its own producers of crude oil and petroleum products, as well as partners in the USA, Netherlands and Saudi Arabia.

Kwarteng commented: “We have more than enough time for the market and our supply chains to adjust to these essential changes. Businesses should use this year to ensure a smooth transition so that consumers will not be affected.”

With the aim of crippling the Russian economy further, the move will impact the country’s reliance on fossil fuel exports. Russian oil makes up 44% of Russian exports and 17% of their federal government revenue through taxation.

Kwarteng also revealed that a new joint taskforce between industry and government will work together to manage the transition over the coming months.

The elimination of oil imports adds to the raft of restrictions placed on existing trade, financial and personal sanctions already imposed by the UK against Vladimir Putin’s regime.

According to the UK Government, Russian oil is already being ‘ostracised by the market’, with nearly 70% of oil currently struggling to find a buyer.

Currently, Russian natural gas makes up less than 4% of the UK’s supply, and MPs are currently exploring options to reduce this further.

The UK's move followed the United States and the European Union, with US President Joe Biden announcing a ban on Russian oil and the EU announcing a phasing out of reliance on Russian energy by 2030.

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