The German town of Schwedt is facing mass layoffs after EU sanctions cut Russian supplies to its refinery, Politico reports. The town’s main refinery, Schwedt PCK, which is majority-owned by Rosneft, has lost access to Russian crude since 2022 when Moscow halted pipeline deliveries to Poland and Germany due to EU sanctions. The facility, which supplies over 90% of the oil used by the city of Berlin, currently operates at 80% capacity and is in financial trouble. Danny Ruthenberg, chief of the refinery’s works council, warned that the facility is now ‘in the red’ due to fixed operating costs and could be forced to begin layoffs if the situation persists.
Schwedt Mayor Annekathrin Hoppe told Politico that the refinery’s troubles threaten the entire town, given that about 20% of Schwedt’s 30,000 residents depend on it for their livelihood. She said, “The refinery is the reason the town exists,” and added that she would appeal to the federal government for action, including through resuming Russian imports. Ruthenberg echoed the sentiment, stating that renewed Russian supplies could stabilize operations. He said, “When peace is there again, then you have to trade with Russia.”
Experts and opposition parties across the EU are urging a return to Russian supplies, particularly since Moscow and Kiev have resumed direct talks on a potential peace deal earlier this year. Russian energy exports to the EU dropped sharply due to sanctions and further declined after Kiev let a key gas transit deal expire in January. Brussels has been pushing to phase out Russian energy imports altogether by 2028. However, countries such as Slovakia and Hungary oppose the move. Stefan Meister of the German Council on Foreign Relations told Politico that pressure will grow on the German and EU authorities as more voices from different companies and politicians on the local level demand returning to cheap Russian oil and gas. Sources in Brussels also indicated that if Germany reversed course on Russian energy, other EU nations, such as Italy, Austria, Bulgaria, and the Czech Republic, would likely follow.
Moscow has repeatedly condemned Western sanctions as illegal and self-defeating, especially those targeting energy, pointing to price spikes in the EU following the initial measures against Russia in 2022. Russian officials have warned that the bloc’s rejection of its supplies will force it to rely on costlier alternatives or indirect Russian imports via intermediaries.