British Chancellor Sunak warns UK faces £70 billion hit from EU ban on Russia oil and gas – FT

“An immediate EU-wide embargo on Russian oil and gas imports would send economic shockwaves throughout Europe and cause at least £70 billion of damage to the British economy,” said UK Chancellor Rishi Sunak per the Financial Times (FT).

Key quotes

His warning comes after prime minister Boris Johnson urged western allies to follow the lead of the UK and US and ban imports of Russian hydrocarbons.

At the same time, the UK announced it would cut all Russian oil imports to zero by the end of the year but has yet to make its position clear on Russian gas.

The EU did not follow suit and instead unveiled a plan to cut Russian gas imports by two-thirds within a year. But last week, more than 100 MEPs signed a letter calling for an EU ban to kick in immediately, despite the huge dependence of countries including Germany on Russian imports.

The chancellor is already struggling to address a looming cost-of-living crisis — including inflation and higher prices for food and petrol — with rising energy prices alone set to impose a £38 billion burden on households by the end of the year.

FX implications

GBP/USD traders paid a little heed to the news while trading sideways around 1.3160, up 0.09% intraday during Friday’s Asian session.

Read: GBP/USD: Bulls look to recapture 1.3200 as BOE raises the interest rate to 0.75%