German trades reject immediate ban on Russian imports

German trade unions and employers have warned that an EU attempt to shut off Russian gas imports in the immediate term could lead to unemployment and intolerable operating costs for domestic factories.

With the war in Ukraine posing stern questions for Europe's economic policy, EU leaders are considering an expansion of the bloc's Russian coal embargo, announced April 7, to also include oil from Russian suppliers. The question of whether to include gas in near-term targets remains unresolved.

The lead for Germany's energy utility association last week called for a firm timetable that will support customers looking to exit Russian gas deals.  However Klaus Miller, leader of the energy regulatory authority, warned April 12 that Germany's strategic gas reserves would not last beyond this summer if all Russian contracts are immediately cancelled.

The Ukrainian government has called for European leaders to double down on Russian energy embargoes, including natural gas, which it says have funded the Kremlin's unrelenting attack on its country. A tougher line on Russian gas imports has been mooted in several EU member states in recent weeks.

Germany's federal government on March 25 unveiled an ambitious plan to become largely independent of Russian gas imports by mid-2024. While Russian gas currently covers around 40% of German consumption, Berlin believes further progress can be made quickly given that Russia's share of demand amounted to 55% last year, according to official figures.

Germany buys most of its gas through Gazprom's Nord Stream 1 pipeline, and has secured additional Russian offtake through the Yamal Europe pipeline that passes through Poland and Belarus. Plans for a second Nord Stream string were axed following the invasion, and Berlin now aims to deliver at least three LNG import terminals as an alternative, having allocated €3bn in capital support for the projects.