Can the west slaughter Putin’s sacred cash cow?
Allies of the Ukrainian president Voldymyr Zelenskiy say Vladimir Putin will only accept a compromise on Ukraine’s future neutrality if he is facing a credible threat to his economic power base by a rapid and permanent exclusion of Russia’s oil and gas exports from its lucrative European markets. The Russian government receives 40% of its budget revenues from energy exports.
But Ukraine is meeting stubborn resistance from Germany, which insists its economy would be plunged into recession if it suddenly lost access to Russian gas and oil.
In an interview reflecting the moral pressure Germany is under to do more, Germany’s Green economics minister, Robert Habeck, admitted Europe in the past had fed Ukraine false promises, but said Germany could not afford “the loss of hundreds of thousands of jobs” that a full energy embargo would require. He said Germany at best could be freed of Russian coal by the autumn, of its oil by the end of the year, but could set no date for ending German reliance on gas.
The impasse is leaving senior allies of Zelenskiy feeling frustrated, and appealing to the UK and the US to use the G7 to try to persuade the Germany chancellor Olaf Scholz to sign up to a western timetable to end dependence on Russian energy.
Scholz and Emmanuel Macron, the French president, spoke with Putin again at the weekend. Zelenskiy’s chief negotiator, Mykhailo Podolyak, has said the talks between Ukraine and Russia are now virtually continuous, and have got past the stage of trading ultimatums. But the French sound less optimistic. Jean-Yves Le Drian the French foreign minister said “We are in front of a wall. The worst is ahead of us. This war will be long.”
The frustration with the German position is such that Zelenskiy is
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