a step off plastic with emergency we demerits around $6800000.00 pounds per year. and we're from been to bill me a half conser. you want to contribute by significantly absorb those plus the groups . he says his business and others like it are only small. but they are ready to take on the huge challenge. jessica washington out a 0 to carter. ah, hello, are you watching out a 0 these the stories were following the sour russian forces i continuing their push to encircle the ukrainian capital cave. intelligence report saying, rushes military has edge to within 25 kilometers of center, and a large scale attack could happen soon. rush, his military admits the situation in some ukrainian cities is catastrophic. that says, ukraine and its allies to blank. when you go as you go up, so green you, the humanitarian situation in ukraine,

unfortunately continues to rapidly watson. and in some cities has reached catastrophic proportions. armed ukrainian forces mines in the residential areas, you're destroying bridges and infrastructure as little as a result of those criminal actions against their own people. if this is the action of the ukrainian authorities, i did, those people are forced to survive without eating food, water or medication will not all the russia continues to shell, the port city of mary paul, the mer there says $1500.00 people have been killed so far ukraine says russia wants to capture the city at any cost. mario pole is crucially important for russia because if they seize control over the city, they will establish the rec, land quarter to 2 crime yes, from russian. and they will also cut us off from access to as of see, this is why we still fiercely and heroically defended. and this is why russia so

ruthlessly trying to destroy the cd and capture it at any cost. the kremlin has appointed and acting med in the ukranian city is melia top home that's off to security video released by ukraine, forwarded to show russian soldiers abducting the elected mer. yvonne at the door of the u. s. has announce it'll rush another $200000000.00 worth of weaponry ukraine. it bills on the significant shipments it sent in the late up to the war. and italians talk to the straits of florence on saturday to call for an end to the conflict. ukraine's president's address the crowns via video link. those are the headlines i'm emily angland. the news continues here on al jazeera. after counting the cost code response nato's long plan to military take exercise the largest in

the cold war has taken no new significance at the war rate is in ukraine. day with al jazeera, for the latest development at 35000 feet from 28 nato countries. demonstrate their abilities in a region already edge. ah, hello, i'm adrian finnegan. this is counting the cost on al jazeera. you'll look at the world of business and economics this week. the u. s. and u. k. ban russian oil of the european union announce its plans to drastically shrink its reliance on gas from russia. will high prices undermine global energy security, high fuel costs and long the roots, the bypass russian ass base house sanctions against moscow. a battering the global

aviation industry with ticket prices and freight rates poised to go up and sri lanka reels from food shortages and power cuts as it struggles to repay its foreign debt. and pay for imports is the country on the verge of defaulting on its death. ah, it is the world's largest exporter of natural gas. the 2nd largest oil exporter energy is rushes biggest source of income, but now u. s. president joe biden has imposed a ban on russian oil and gas in response to the invasion of ukraine. the u. k says that it will phase out russian oil by the end of the year, while the european union is aiming to cut gas in ports by 2 thirds this. yep. now the move will wasn't inflation and push up fuel prices at washington is scrambling to find alternative supplies. al 0 is priyanka groups are reports a major escalation of use economic sanctions against russia. 4th invasion of ukraine

. you, especially joe biden, is going after president vladimir potent most lucrative industry. we're banning all in ports of russian oil and gas in energy. that means russian oil no longer be accessible. u. s. porch in the american people will deal another powerful blow to pull information by to acknowledge the latest sanctions could push up us gas prices . consumers are already paying on average more than $4.00 a gallon up from $2.77 just a year ago. due to high inflation, as economy recovers from the pandemic. but it's europe that will feel the effect of moving away from russian energy more acutely than the us. the european union imports 27 percent of its oil and 40 percent of its gas from russia. the block plans to cut its dependency on rush and gas by 2 thirds this year todd

todd. but it's possible if we're willing to go further and faster than we've done before. but experts say disposition will mean difficult compromises. they'll have to be additional use of nucular, which is fuzzy phase out in certain countries, though i'd be more coal use, which won't help climate goals. the usaa seeking to persuade opec members to ramp up output among them. only saudi arabia, the united arab emirates, and quail, half spare capacity. and washington is also turning to countries. it has shunned and imposed sanctions on it's making overtures to venezuela and attempting to see a nuclear deal with iran that could bring more oil into the market. priyanka gupta for counting the cost. joining us now from london, toby whittington lead economist at oxford economic study, great to have you with us on not counting the cost is this ban on

a russian imports of oil in it into the u. s. largely symbolic. what is it that the u. s. use is something like 8 percent of russian oil. is that correct? yeah, that's, that's right. i mean, i think you have to write it as a logic symbolic moves. and, you know, obviously you, us demand a u. s. usage of russian oil is fairly limited and i think substituting out to, to alternative suppliers, i think probably within the north american market would be possible. there may be some sort of frictional cost in the, in the process of doing that. but those, those would be sort of temporary and quite moderate. and so we wouldn't expect too much of a, a price shock from this movement in terms of oil. is there anyone that who could plug the gap, the u. s. appears to be making attempts to repair relations with venezuela, which of course has as huge oil stocks, but its infrastructure isn't, isn't it any fit shape of the mother?

and of course the, the round nuclear deal talks could come to some sort of fruition and sanctions might be lifted on iran. could venezuela at iraq, perhaps help offset the shock? i think those are both too key key markets and certainly given the situation we're in there is an impetus now to try to bring those to countries back into the the global oil market. discussions are ongoing. as you say, i think venezuela's or infrastructure is in a slightly poorer state than what it is in iran. i think i estimates put them around about 700000 barrels a day that they could start exporting or iran is a bit higher referral. about $1300000.00 barrels a day that they could put out by the end of the year and was potential to stop it even further. and so, so those are important markets, but i think the key sort of produces are as ever the, the major opec produces, or saudi arabia and, and the, you a, you know, as well, okay. and you talk about the europe looking to to when itself, off of frush and gas when we're not talking about oil here. and perhaps it's plans

being a little overly optimistic at the moment. who would fill the gap? there? would it be countries like kata, australia, i mean you get the looking at shipping gas from the other side of the world to, to europe. i cannot be done yet. that the 3 major sort of at n g exports is of the u. s. cats are in australia, i think australia is pretty out of the picture. they overwhelmingly supply the australian market. so that the asian market, and of course, getting gas from, from shipping gas from australia to europe is a huge endeavor. i think it would come primary from the us and, and cattle. ah, it's not entirely clear that's enough. export capacity exists at the moment. so as part of the planet they want to withdraw reduced dependents on russian gas by 2 thirds within 2022. so that's 9 month centrally to, to do it. and half of that 2 3rd saving is going to come from extra allen gm ports

at which, which roughly equates out about a 60 to 70 percent increase in, in a, you imports of l n. j. i think that's highly optimistic given given current export capacities and also a you input capacity is a valid g. i think if they could reduce dependence by maybe a 3rd, that would be very good. i think 2 thirds is it's probably pushing it too far, really. and is this, i mean, this is all about sanctioning washer, it's, it's, it's a financial penalty for rush rates. it's aimed at causing he can only com to, to russia. ultimately, though, is, is russia still going to be able to sell it oil and gas? will there be buyers out there? will it be able to sell, so sell at market price? is it really going to hurt wash it? well, i think i got a bill in the long run. i think, you know, if russia loses access to western markets is most taxes us. it was only is access to europe as europe seems to be implying that you know, that will, will have an impact on russian, on demand for russian oil,

which should reduce the price that they can pay. i mean that they're going to be able to sell to other countries, china in asian countries and so on. but that sort of reduced number of buyers will necessarily, i think, reduce the amount of price they can pay. i think that's true, also gas as europe 6th, when itself off your russian gas rusher is in the process of transiting to the china building. you pipeline infrastructure to supply gas from, from the field down and down into china. but that's a massive interest. an effort to take some time to, to come on line. and also china will be in quite a strong bargaining position, of course. and, you know, with russian not having many other customers, china will, will be able to, to leverage that position to negotiate themselves. a better deal, so yeah, in some way i think it rushes, the price that they can achieve for their in jack sports will,

will undoubtably go down. toby, it's been great to talk to you on counting the cost many thanks. indeed for being with us. thank you. ah, the surgeon oil prices as push the cost of global jet fuel to a 14 year high airlines and travelers are facing steep fair increases just as air travel was beginning to recover after cove at 19 will adding to the burden of high prices are the circuitous flight paths needed to avoid washing airspace right now. the biggest impact is on flights between europe and asia destinations like japan, south korea, and china. longer flight times lead to higher staff costs, limited cargo carrying ability, and they raise maintenance costs. and russian airlines have also been hit by the air space bands. they won't be able to access parts and services that they'd sourced from a broad to discuss all of this. joining us from london, peter morris, chief economist at the asian consultancy ascend by syria. peter, good,

have you with us on counting the cost? just as airlines were beginning to sport, a patch of clear skies after the horrible time they've been through with the pandemic here we have more turbulence caused by higher oil prices. i was just how bad an impact is this going to have are already suffering aviation sector? well, it's yes, another negative. i mean, if, if you look at this proportion of globalization that is linked directly to russia, it's of the order of 6 percent or so which she can say no could be managed without . but on the other hand, what you're talking about yet, another negative factor, and we haven't even got to the level of the increase in fuel prices appears to have been linked to this whole invasion. so what will higher oil prices, higher fuel prices mean for the likes of you and i, the people who use the airlines is that going to lead to higher ticket prices for

us? it's never going to lead to higher ticket prices, but there will be a couple different to in new fact that when you're traveling, for example, with in europe, the proportion of the ticket let's feel is lower. whereas when you're traveling to australia, for example, it's a much higher proportion. so it will mean that shawl is impacted less than long haul travel. that's more than 3 hours. not only is, is fuel going to cost more, but airlines are going to have to use more of it to fly around russian aspects of vast part of the globe that they now have to avoid. i think there's 2 fact to say 1st, yes, it will increase flight times by between one and 4 hours between europe and asia. but on the other hand, if you look at the level of closure on international services, it's taking place in japan and, and china, the moment that actually that traffic is very badly hit anyway. but again,

this is yes, another negative that added in. i'm one thing it does mean that the, the airlines that have new fleets, the term more fuel efficient saving, perhaps 20 percent of fuel on journeys will actually have a competitive benefit compared with others. they'll still be suffering in paying the high cost, but they will have something of a competitive advantage. what does the, the ban on, on, russian aircraft flying into european space, for example. what does that mean for russia's aviation sector? well, it's been very badly hit as, as symbolized by the airflow withdrawing services internationally from the 8th of march. so as a consequence, they're not flying for fear that the planes could be in candid or something like $500.00 aircraft, according to our databases that are least into russian entities from international leasing companies. and those effectively,

the leases have to be terminated by the 28th of march. so that means that any aircraft that sent flying outside can be impacted. and also under international law, the airlines are supposed to be handing those aircraft back. if they don't hand them back, because they simply can't at the moment due to, to circumstance, what does that mean for the international leasing companies? they could lose money, of course, because these, these aircraft are sitting on the ground in russia. they think they can't get to them. it is a major challenge, one way or another. and the thing is we can only look at the unfolding and impact of the sanctions and so on. but it is clearly one of the major impacts that will be seen in russia among russian air travelers realizing you can't fly as easily or as cheaply she did before. and it will mean that, for example,

the middle east now lines who do fly to russia will actually have a significant captive market. we lost a lot of airlines due to the pandemic. it just wasn't survivable for many of the smaller airlines. all those running on on very tight operational budgets with this continuing agony now with the air space restrictions around russia with the increasing fuel prices. do you think that we'd like to see other airlines going on? but it's going to increase suppression? ultimately, it's really what the impact on individual countries g d p is because it's, it's g d p and the ability of people to buy tickets effectively that drives the airline business forward. and one of the concerns is the impact in terms of g d. p growth will actually reduce aviation growth as well. but none of these things are posted. this is the basic point all looking at

a little bit. please get them over to say the least. peter, but anyway, thank you really appreciate you outlining all of that for us. peter morris, that a lot of now food shortages, power cuts and long lines for expensive fuel sri lanka is facing its worst economic crisis since independence in 1948 international rating agencies. a warning that it's on the verge of defaulting on its debts, but the government has refused to seek an iron f bailout, and insist that it can handle the crisis on its own al jazeera. but i'll fernandez reports from colombo spending hours in queues has become the norm, a crush lanka, starting with food, rice, sugar and mid powder. now it's cooking gas and diesel that arissa supply. that of ivy, that it all a similar day. i haven't eaten from the morning and i can't even go drink some water line. i would lose my place. otherwise meant that have only me that, that not thing. after spending so many hours and cues, we can only run about 2 and a half days. we can't keep doing this,

so we appeal for this problem to be solved. the shortage is a result of the government not having enough dollars to pay for info. this is because it's foreign. earnings and reserves have been rapidly declining since 2019 huge debt repayments of ethan into a big chunk of available resources. the crisis has affected all sectors, including public transport. operator said they are struggling to survive from day to day after that. mama, on the one hand, there's no electricity, they cut power for 7 and a half hours. the diesel stocks i come up with half is given for power generation a lot. it's only half the stock that's used for everything else. after months of coping, people protesting yet and chill out notice colombo fishermen complain. they don't have fuel for their boats knocking it off. my husband can't gotcha say there's no diesel or hope those responsible struck by lightning in columbia. silent protests, enough is enough, says one bene, stop ruining my country,

reads another month of skyrocketing prices and shortages of food, medicine, cooking, gas and fuel have made sri lankan, frustrated and angry. to make matters worse, they have suffered through the worse pol got to be impose in more than 25 years. 7 and a half hour interruptions, a day, a causing chaos. among all segments of the population, sri lanka, public utilities regulated says it has been pushing to solve the power crisis. these, these had to become a national issue to necessarily yeah. the attention has not been bid by the political hierarchy then than now. and the authorities. so we have been fighting in all of, with almost everyone to sort out this issue. increasing prices and shortages are not unique to shanker but people here say their leaders of aggravated the situation through years of corruption and mismanagement. minute fernandez, ojo 0,

colombo was like, has usable foreign currency reserves are plunged below $1000000000.00. now the rising cost of oil imports is shrinking, that even further leaving it vulnerable to a debt default. the tourism sector, a major foreign exchange, erna was battered by the east to attacks a 2019 and of course, the corona virus pandemic. and now 2 countries vital to shall, anchors tourism market are at war. russia and ukraine had been the 1st and 3rd largest source of visitors this year of fail drive to become the world's 1st 100 percent organic farming nation hurt. food security shall anchor was forced to import rice. the t. croft, the nation's top export was devastated. shall i can i want china, a major lender to restructure its debt. and it's negotiating a $1000000000.00 relief package from china as geopolitical rival, india. let's talk all of this through now with the shall de mel in colombo. he's an

economist and research director at verity research. he served as economic adviser to sol, anker's, finance, ministry 42017220. 19 dash. all great to have you with us. is cheryl anchor on the verge of defaulting on its debt? so sir langa is to see a very challenge situation on its a foreign exchange. her reserve was a position right now, so it usable reserves that excluding the $1500000000.00 chinese, you ensemble amounted to just $734000000.00 at the end of february that you have met in port coverage around 2 and a half weeks now in the month of february and march 2 lanka had liabilities maturing, amounting to $1800000000.00. so the, the gap between usable reserves and maturity liabilities is clearly betty betty. hi, you're not going to like us favor. now there was a deferment of $900000000.00 of an ac. you payment issue engineering,

union payment that was due to be paid earlier this week that deferred by 2 months. so that does provide a little bit of a levy for the next few weeks. but overall, to the very challenging, challenging situation on its external external debt. and it's one of the reserves and the government says that it can manage this, this situation on its own without resorting to help from the i m f. is that a wise strategy? do you think so i would think the most prudent auction now was to enter into negotiations, but it made it pretty does. because due to restructuring, it's extended to restructure in a preemptive manner. and such a restructuring program would ideally be underpinned and supported by and i'm if agreement an agreement that situation would be able to unlock some options of bridge bridge financing. that'll help to don car to build up reserves in the interior. it goes through a restructuring process. now even if somehow we don't quite able to meet its maturity, that's liabilities by scraping together some swaps. so gum to government transactions

is to doing so at the expense of critical inputs for the economy in both such as for cooking, gas and a number of other important commodities. as a result of beach citizens off the thing, a degree of hardships are really the best balance from the street. and the comic book in the, in the long term, would be to preemptively restructure the external liability. but at issue that we've discussed many, many times on counting the cost, how much of this current crisis is due to the fact that so lanka is so indebted to china. so i would say that the, the current situation is not entirely because of duncan liabilities for china. so if you look at the upcoming maturities over the next few years, typically around 20 percent of the maturing liabilities are laboratories that, to, to china. the bulk of the bulk of life is actually arise out of cars borrowing from commercial markets, from financial markets,

particularly have been bonds, indicated loans and so on. so why is that? is a component of chinese debt 10 chinese diabetes in this industry question? i would not say that it is the predominant cause of the challenges facing right now . all right, what, what, what is the course we talked a few moments ago about the now scrapped policy to switch to 100 percent organic farming. that affected exports on food security. we talked about that the t industry, the biggest export of suffering is, is that one single cause or is just showing in the wrong place of the long time economically at the moment. so this crapping of chemicals are fertilizer replacing the organic fertilizer that the of you don't have evidence as yet to be able to attribute it to say the decline in exports in january. so survey data conducted by data research does suggest that farmers do expect significant decline in use, so there would be some impact from from that policy as well. but sri lanka is real

problem is the fact that it lost access to global credit markets around early 2020 . just before the, the pandemic, the pandemic it by losing access to global credit market. it's been not been able to raise a capital to be able to refinance, is maturing debt. so it had to pay to pay back debt using its reserves, and to be reserves have as a result, windows down to the lead levels that we are at. and that's really the crux of the problem that we are facing funding extremes, which are like us tourism industry, taking such a big hit, 1st of all from the pandemic. and now, due to that, the war in ukraine, is there anything that the government can do to increase it's, it's, it's foreign currency reserves, you know, took to earn currency that it desperately needs. yeah, so certainly the ukraine does have an impact on, on to not cause to it isn't, it was just recovering in the last few months around 25 percent of arrival

in the last few months have been from the ukraine or russia. so the conflict that 30 does have an impact on, on the balance of payments as does of course, been on impact factor seeing in global commodity prices, particularly, particularly oil gas. we and number of other important products as well because we don't use the net important. so 30, the current geopolitical challenges do not work into junk, are feeling in terms of, in terms of the current account. that said, the government has taken some important positive steps in recent days. it floated, there will be the center back floated, but we're not going to be a couple of days ago. and that's certainly a step in the right direction towards encouraging more influence to for move banking channels that can hit the build up of the back of the positive. the central bank also recently raised policy interest rates by a 100 basis points. at last week's march board meeting, again, a positive in terms of demand management and towards building up reserves. so that after that i did action, that's a long way to go. in terms of facilitating further the moves on the monitor side as

well. if that is underpinned by an i missed program and that restructuring, i would think that is really to be a for the, for so long to really sustainably build up to reserves. and to be able to book me to extend the treatments and provide the inputs that are required to sustain the phone, m dash i'll it's been really good to talk to you on county the cost many thanks for being with us. thank you very much. and that's all show for this week. don't forget, you can get in touch with us if you want to comment on anything that you've seen, you can tweak me. i'm at a finnegan on twitter. please use the hashtags ctc when you do or you can drop us a line counting the cost of al jazeera dot. that is our email address. that is, as always, plenty more for you online at al jazeera dot com slash ctc. that takes you straight to the page, and there you'll find individual reports, links, even a tot episodes for you to catch up. but that is it for this edition of counting the cost. i'm adrian finnegan for the whole team here in bo. how,

thanks for being with us. the news on al jazeera, his next big coin block chain, and crypto guarantees, disruptive technology join with me and introducing a bill to outlaw crypto currency, all the way to a fair, a financial system. it declines open source software. we can create our own money without banks or governments award winning filmmaker toast and huffman looks at all sides of the complex crypto. well crypto. yeah. it going look change in the internet on out to sierra no place in saigon, which say press, retreated with the car about a media hub and vital vantage point during the 1st truly televised war from the roof. we could see evacuation at the american embassy, where the most iconic images of the conflict in vietnam were transmitted to the

world. this was the front row sheet to the final stages of the war, saigon, caravel war hotels. on l. g 0. ah, a good people scrambled to escape. keith is russian forces. surround the capital, preparing for a feed all laos is so ah hello, i'm emily. ang, when you're watching al jazeera coverage of the war in ukraine, and now the day and night of intense shelling in the besieged city of mary, a pole. the mass is 12 days of rush and bombardment have killed 1500 people.