The EU’s plans to adopt a twentieth sanctions package against Russia have been frozen due to a disruption caused by the war in Iran, according to a diplomatic source cited by TASS on March 16.

Citing diplomatic sources in Brussels, the newswire said there was little prospect of approval in the near term, as rising oil prices and instability in global energy markets complicate negotiations in Brussels.

“The war in Iran has temporarily paralysed the EU’s plans to adopt a twentieth  package of sanctions against Russia, and there is no chance of its approval in the near future in Brussels,” a diplomatic source in Brussels told TASS.

The package was supposed to be approved in time for the fourth anniversary of the start of the war on February 24, but embarrassingly the growing internal divisions within the EU scupper the efforts to put the latest sanctions through.

Hungarian Prime Minister Viktor Orban and Slovak Prime Minister Robert Fico were one obstacle, who have refused to pass the package due to the Druzhba row between Hungary and Ukraine.  Hungary has blocked both the twentieth sanctions package and a decision to release the €90bn EU loan for Ukraine, after the Druzhba oil pipeline was shut down in January after a drone attack. Orban has accused Zelenskiy of spinning out the repairs to starve Russia of revenues.

However, the package has also faced stiff opposition from EU shipping countries. Greece and Malta both have significant fleets of tankers that have been profiting from working for Russia as a major part of its shadow fleet.

Amongst the measures in the latest sanctions package is the end of the oil price cap sanctions   methodology and a blanket ban on all EU registered ships from working for Russia. Previously, EU ships could carry Russian oil as long as barrels were priced at first less than $60, and later a floating rate oil price sanctions cap of 15% below market rates for the Urals blend was introduced.

“The main provision of the twentieth package is a complete ban on European businesses engaging in maritime transportation of Russian oil or providing any services to its carriers, including insurance,” the diplomat told TASS.

Recent energy market volatility has emerged as a key concern, making MEPs hesitant about drastically tightening restrictions on Russian energy imports. Oil prices have jumped from around $65 per barrel pre-Iran war to close at $108 on March 18 after Israel’s South Pars and gas prices have more than doubled.

The high prices come as the EU goes into a deepening gas crisis as the gas restocking season opens with record low gas in storage tanks, which are only 30% full. Last year, Europe remained a top four importer of Russian gas and in February bought Russia’s entire export of Yamal LNG gas as it races to restock before the start of this year’s heating season. According to IntelliNews Lambda calculations, Europe’s tanks will only be 75% by the November 1 deadline, when EU rules mandate tanks should be 90% full. MEPs are concerned this is not a good time to be cutting back on the import of Russian energy.

“The sharp rise in oil prices as a result of the war in Iran and the blockade of the Strait of Hormuz have paralysed any attempts to adopt this package, at least until the market situation normalises,” the diplomat told TASS.

The diplomat said the approval of the twentieth sanctions package “is not on the agenda of the EU Council meeting [at the level of foreign ministers in Brussels] on March 16.”