FX.co ★ Bloomberg analyst calls Europe's plan to ditch Russian oil 'economic suicide'

According to Bloomberg analyst Julian Lee, Europe's intention to reduce Russia’s oil exports to zero poses significant risks to economic stability in the region.

He believes that the Western countries’ plan to stop buying Russian oil is tantamount to economic suicide. In particular, Lee drew attention to the stance of Hungary, Slovakia, and Croatia, which refused to support the planned oil embargo against Russia in the next six months. The refineries were built there specifically to process the particular blend of crude pumped from Russia. Thus, the search for alternatives will be a big challenge for these countries, he explained.

Although imposing sanctions on Russia’s refined products exports raises a number of problems, Lee sees no reason to abandon the aim of ending Europe’s purchases of Russian crude. Given that oil products require crude of certain characteristics, the European Union should reduce its dependence on Russian oil supplies through a sequential reduction in those volumes, he added.