European leaders reach an agreement on a Russian oil ban, a significant measure aimed at cracking down on Moscow

• European Union leaders reached an agreement on Monday over a Russian oil ban.
• The significant measure is aimed at punishing Russian leadership for its invasion of Ukraine.

European Union leaders reached an agreement on Monday over a Russian oil ban, the head of its executive arm said on Monday, a remarkable measure that officials negotiated for months and is aimed at punishing Russian leadership for its invasion of Ukraine.

"This will effectively cut around 90% of oil imports from Russia to the EU by the end of the year," European Commission President Ursula von der Leyen said in a tweet on Monday.

The ban marks the latest penalty that world leaders have placed on Russia this year in efforts to weaken the country's financial position and end the invasion of Ukraine headed by President Vladimir Putin.

The EU has imposed a sweeping set of sanctions against Russia, including a ban on iron and steel imports, and the US has prohibited Americans from providing consulting services to people in Russia.

Why EU leaders think the oil ban will work

Oil has long been a key part of Russia's economy. Russia is one of the world's top crude oil producers, and it relies heavily on oil and natural gas revenues, which last year made up 45% of its federal budget, according to the International Energy Agency. Prior to the war, Russia made up about half of Europe's 1.2 million barrels per day of annual diesel imports, or 10% of its total diesel consumption, HSBC analysts told clients in a report this month.

"This immediately covers more than 2/3 of oil imports from Russia, cutting a huge source of financing for its war machine," Charles Michel, president of the European Council, said in a tweet on Monday. "Maximum pressure on Russia to end the war."

On Friday, Bank of America analysts said European crude oil imports from Russia had already fallen by some 700,000 barrels per day, "and may drop further if oil sanctions are finally enacted."

Crude oil prices were trading around their highest levels in two months on Monday.

Since Russia's invasion in February, the United Nations has officially recorded 4,074 civilian deaths and 4,826 civilian injuries in Ukraine. The UN's Office of the High Commissioner for Human Rights estimates that those figures are far higher.