‘Peace or air conditioning?’ Italy vows to follow EU on Russian gas embargo

As the EU weighs new sanctions on Russia following atrocities in Ukraine, Italy's government said it will support measures including a possible gas embargo.

'Peace or air conditioning?' Italy vows to follow EU on Russian gas embargo
Prime Minister Mario Draghi said Italy will “go with the EU” on proposals for further sanctions against Russia. Photo by Aris Oikonomou / AFP.

Italy will “follow the decisions of the European Union” on new sanctions against Russia, Prime Minister Mario Draghi said at a press conference on Wednesday.

READ ALSO: Italy announces plan to end reliance on Russian gas by 2025

“Today the gas embargo is not yet… on the table,” Draghi told reporters after a cabinet meeting.

“It is not a possibility being discussed at the moment, but the situation is constantly evolving.”

“If we are offered a gas embargo, we will follow the EU down this path, we want the most effective instrument to achieve peace,” he said.

Italy is highly dependent on Russian gas, importing 95 percent of the gas it consumes, of which around 40 percent comes from Russia.

The growing number of “massacres” in Ukraine “is prompting us to adopt even tougher sanctions,” he said. “All the allied countries are wondering what can be done to stop Russia… We are following what the European Union decides.”

Draghi said “I believe the question is between peace and having working radiators, or air conditioning in summer. I think this is the question we must ask ourselves.”

He pledged that “if gas supplies were to stop today, we would be covered until the end of October with our reserves, there would be no consequences”.

READ ALSO: Italy rejects Russian demand for gas payment in rubles

Draghi, a former ECB chief, also called for a ceiling on gas prices.

“I have been asking for some time to put a ceiling on the price of gas, that would be the most rational thing at the collective, European level.”

“The EU has extraordinary power in the market, it is in fact the only buyer,” he said.

This power “can be exercised through the establishment of a price that is remunerative but not extravagant like the one we have now.”

He said the EU would make a proposal on a price cap “in a few days, but we can also proceed with national measures.”

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How long will it take Italy to wean itself off Russian gas?

Italy's government has repeatedly said it plans to end its dependence on Russia for gas supplies following the invasion of Ukraine. But as the timeline keeps changing, when and how could this happen?

How long will it take Italy to wean itself off Russian gas?

Italy is heavily dependent on Russian gas, but has been seeking new sources since Moscow’s invasion of Ukraine as part of an effort to end this reliance in the coming years.

But it remains unclear whether Italy can really end its dependence on Russia for its gas supply – or when this might be feasible.

READ ALSO: What does Italy’s Algerian gas deal mean for energy supplies?

The government has been seeking new sources since Moscow’s invasion of Ukraine, including with a recent deal to boost supplies from Algeria.

Prime Minister Mario Draghi said last week the country could be independent of Russian gas by the second half of 2024 – the latest in a series of changing estimates.

“Government estimates indicate that we can make ourselves independent from Russian gas in the second half of 2024,” Draghi told the Senate, while adding that the “first effects” of this plan would be felt by the end of this year.

He said his government was also seeking to boost its production of renewable energy, including by “destroying bureaucratic barriers” to investment, saying it was the “only way” to free Italy from having to import fossil fuels.

Explained: Why and how Italy will pay for Russian gas in rubles

In April, Italy‘s Ecological Transition Minister Roberto Cingolani estimated the country would no longer need Russian gas within 18 months, following an earlier prediction that it could take until 2025.

Italy is one of Europe’s biggest users and importers of natural gas, importing 90 percent of its gas supply with 45 percent of that coming from Russia – up from 27 percent ten years ago.

Italy now imports 29 billion cubic metres of Russian gas a year, which Cingolani said in March “must be replaced” – but he didn’t specify with what.

Analysts have said there are “a lot of questions” about how helpful Italy’s gas deal with Algeria will be.

Despite its vast natural gas reserves, Algeria is already exporting at close to full capacity.

Draghi repeated his strong support for EU sanctions on Moscow last week, including a proposed ban on imports of Russian oil, although this is currently being blocked by Hungary.

“We must continue to keep up the pressure on Russia through sanctions, because we must bring Moscow to the negotiating table,” he said.

But for now, Italian energy giant Eni says it plans to pay for Russian gas supplies in rubles, meeting a demand from Vladimir Putin.

It was not immediately clear whether the plan would fall foul of European Union sanctions, although Eni said it was “not incompatible”.

The company said its decision to open the accounts was “taken in compliance with the current international sanctions framework” and that Italian authorities had been informed.