On the 25th of May, 2022 ICEUR convened a select public to discuss a talk given by V. Inozemtsev, one of the top experts on the state and perspectives of the Russian economy.
The question for the West is, he holds, how to break free from dependence on Russian oil and gas. Inozemtsev sees two basic options: 1) do nothing at all and 2) total embargo. Neither option will really bother Putin. For Russia oil and gas are equally important, for Europe gas is much more important. In the event of an oil embargo, revenues would drop by 50%. Gas revenues account for 7% of all export earnings and gas is mostly exported to Europe through pipelines. In contrast to oil, its transport is tied to existing pipelines for the time being, so it cannot be quickly diverted to Asia, as announced. As of now, there is only one functioning gas pipeline to the east, the Power of Siberia. Although Russia has developed an LNG program, the necessary equipment would have to be ordered from Western companies. An embargo would decrease Russian gas revenues by 30 p.p.