Explained: The impact of EU’s move to ban Russian oil imports

Moscow, May 06: European Commission President Ursula von der Leyen called on the EU's member nations to phase out imports of crude oil within six months and refined products by the end of the year.

"We will make sure that we phase out Russian oil in an orderly fashion, in a way that allows us and our partners to secure alternative supply routes and minimizes the impact on global markets," von der Leyen said.

The proposals need to be unanimously approved to take effect and are likely to be the subject of fierce debate. Von der Leyen conceded that getting all 27 member countries - some of them landlocked and highly dependent on Russia for energy supplies - to agree on oil sanctions "will not be easy."

However, Hungary and Slovakia have already said they wouldn't take part in any oil sanctions.

If approved, the move will not only sever Europe's oil ties to Russia, but it would lead to shortages and higher prices for gasoline, diesel, jet fuel and other products. It could be disastruous for consumers already struggling with inflation and pandemic-hit economy.

The EU is Russia's biggest oil customer, and the new sanctions going to make it very difficult for Moscow to easily switch to other buyers in Asia.

The move is also going to have an impact on global oil prices and on the EU. However, EU's aims are clear. Europe wants to deny President Vladimir Putin funds from sales of oil, usually his largest export earner and a cornerstone of the Russian economy.

It is worth notable that Russia is the world's second-biggest crude oil exporter after Saudi Arabia.

After the ban, the countries like the US, the UK, Canada, and Australia-will have to buy oil from non-Russian sources, some of them also have India as a buyer and their by result in more supply shortages and a further price spiral.

Higher oil prices could only mean hike in petrol and diesel for private vehicles. It results in higher transportational costs of essential commodities (including fruits, vegetables and foodgrains) will also cost more.

Construction, manufacturing activities could also take a hit. Companies can hire fewer employees, overall economy takes a hit.