West Must Target Putin’s Oil, Gas Income, Naftogaz CEO says

(Bloomberg) -- Cutting off Russia's income from gas and oil is the only way to force Russian President Vladimir Putin to pull back from his invasion of Ukraine, the head of Ukraine's largest state-owned oil and gas company said.

Naftogaz Chief Executive Yuriy Vitrenko said the U.S. and allied nations should continue taking deliveries of Russian oil and gas but withhold payments in an escrow account until Putin retreats. Russia will need to continue to pump because simply shutting down wells would do permanent damage, he said.

Putin views his country's energy output as his biggest bit of leverage because, “He believes that the west depends on Russian oil and gas,” Vitrenko said in an interview Friday. 

“If he understands that he won't be getting any money from the west,” Vitrenko said. “It can change his mind.”

Russia's invasion of Ukraine has triggered a sharp increase in energy prices. European gas prices jumped as much as 33% Friday and oil rose another 5% on growing fears that supplies will be cut as a result of the war. Russia is the world's largest energy exporter.

There is building sentiment in the U.S. Congress to ban oil imports from Russia, but the Biden administration and European governments have been reluctant to take such a step because of the impact it would have on the global economy.

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