A serious diplomatic crisis is brewing within the European Union. The discussion of the 21st sanctions package against Russia, intended to increase pressure on Moscow, is on the verge of collapse. Sources report that Brussels is forced to seek a compromise due to stiff resistance from several member states, which fear negative consequences for their own economies.

Greece Opposes LNG Restrictions

The key stumbling block has become the issue of banning the transshipment of Russian liquefied natural gas (LNG) in third countries. Greece, traditionally oriented towards energy cooperation with the Russian Federation, categorically opposes this provision. The authorities in Athens argue that such restrictions would hit European companies operating in the ports of the Balkans and the Mediterranean.

As a result, the consideration of the package stalled last week. To avoid a complete failure of the initiative, the EU has developed three options to break the deadlock, which will be discussed in the near future.

Three Scenarios to Save the Sanctions

According to Bloomberg, European diplomats are considering several ways to overcome the disagreements:

  • Seeking a compromise on the extension of existing contracts to avoid abruptly breaking supply chains.
  • The possibility of extending the validity of current measures, even if new proposals are not fully agreed upon.
  • Maintaining the price cap on Russian oil at the current level.

The Battle for the Price Cap

Special attention is being paid to the price cap mechanism. EU member states have already agreed to temporarily freeze the price cap on Russian oil at $44.10 per barrel until July 23. This decision was made to buy time and reach a broader agreement.

Experts note that if the price cap had risen in line with the increase in global rates, it would have weakened the key tool that Ukraine's allies use to suppress Moscow's revenues from hydrocarbon exports.

Who is Demanding Exemptions?

The problem is not limited to Greece alone. According to the Financial Times, six EU states are demanding exemptions in the new sanctions package, fearing blows to their own businesses. The list of countries advocating for softer conditions includes:

  • Greece
  • France
  • Italy
  • Germany
  • Austria
  • Portugal

Ambassadors of the European Union countries are expected to meet this week to continue the discussion and attempt to find a solution that will satisfy all participants in the process.