THE UK Government is drawing up plans with other Western nations to ensure “alternative supplies” of oil and gas can be sourced in response to global efforts to ban imports of Russian fossil fuels that are funding Vladimir Putin’s invasion of Ukraine.
Yesterday, UK Business and Energy Secretary Kwasi Kwarteng announced that oil impots from Russia, thought to make up around eight per cent of UK demand, will be phased out by the end of the year.
Mr Kwarteng today told MPs that “demand can be met by alternative sources of supply” and announced a taskforce in coalition with other Western nations will be set up to draw up a global strategy for maintaining supplies of fuel.
Tomorrow, an extraordinary meeting of G7 energy ministers will take place to set out any further steps that can be taken.
Mr Kwarteng told the Commons that Russian oil makes up almost half of total Russian exports and 17% of Putin’s revenue through taxation.
He said: “Russia produces only a fraction of the fuel products currently imported to the UK. Demand can be met by alternative sources of supply.
“As a result of international revulsion at Putin’s invasion, Russian oil is already being excluded from much of the market.
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“Yesterday I set out that the UK is phasing out imports of Russian oil during the course of the year. This transition will give the market, it will give businesses and supply chains more than enough time to substitute Russian imports.
“Businesses should use this year to ensure as smooth a transition as possible so that consumers will not be affected.
“The Government will work with companies through a new taskforce on oil to support them to make use of this period in finding alternative supplies.”
M Kwarteng suggested that “while Russian imports account for 8% of total UK oil demand, the UK is also a significant producer of both crude oil and petroleum products”.
He added: “We participate in a global market for these products and we have resources in place in the unlikely event of supply disruption.
“Over the course of the year, the taskforce we set up will work closely with international partners, including the USA, the Netherlands and the Gulf to ensure alternative supplies of fuel products.”
The cabinet secretary acknowledged that the UK does not depend on Russia for its gas supply, with only 4% made up from imports from Putin’s government.
But Mr Kwarteng confirmed that he “will be exploring options to end this altogether”.
He added: “We fully intend and we must end our dependency on all Russian hydrocarbons.
“In the meantime, we need more investment in North Sea oil and gas production as we make the move to cheaper and cleaner power.
“Turning off domestic production as some are calling for at this moment would be completely the wrong thing to do and we’re not going to do it.
“The Prime Minister has also confirmed that the Government will set out an energy strategy to explain the UK’s long-term plans for greater energy security including both renewables and nuclear power.”
He added that the blueprint will “take us on a road to building a stronger, more resilient British energy system” and “increase the growing pressure on Russia’s economy”.
Labour’s shadow energy secretary Ed Miliband said his party would “fully support the government’s decision to ban oil imports”, labelling it a “right and welcome step”.
He said: “It’s essential that we learn the right lessons from this crisis.
“The right lesson to learn is therefore surely we have to go much further and much faster in developing home-grown zero carbon power including renewables and nuclear which can free us from the whims of autocrats and dictators who can use fossil fuels as a geo-political weapon.”
Mr Miliband added: “On the North Sea, there needs to be a phased transition.
“We will support the government in everything it does which can cut off support for the evil and barbaric Putin regime.
“We urge the government to learn the right lessons from this crisis fo our country so we can achieve both energy security and energy sovereignty.”
SNP energy spokesperson Stephen Flynn, warned “we cannot escape the sheer scale of what has been announced here”.
He said: “This is a seismic shift in UK, US and indeed European energy policy. We also can’t be blind to the fact that there will be consequences to this. One of those potential consequences is for retaliatory action form Putin himself.
“If there was to be gas and oil shortages on the European continent, as a producer of oil and gas, does this not emphasise the importance of Scotland’s North Sea oil and gas reserves?
“The renewable resources that Scotland has are enormous – 25 per cent of the entirety of Europe’s offshore wind capacity sits off the coast of Scotland.”
Mr Kwarteng said it was “particularly bizarre” to hear an SNP MP “defend the North Sea transition deal and the considerable oil and gas assets in Scotland”.
He added: “I’d be very interested to hear what his Green counterparts in the coalition north of the border thought of his remarks.”
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