The CEO of Volkswagen advised CNBC Wednesday that the German automotive big was holding its choices open when it comes to the way it powers its enormous manufacturing plant in Wolfsburg, admitting coal would nonetheless be wanted as a result of ongoing tensions between Russia and Europe.

Talking to CNBC’s Annette Weisbach, VW chief Herbert Diess was requested how involved he was about gasoline provides from Russia stopping and what that may imply for his agency’s operations.

“That is truly actually a menace … as a result of it’s extremely arduous to foretell what is going on to occur,” Diess mentioned. “Right here in Wolfsburg we nonetheless have coal-fired energy crops which we needed to — and we’re — changing into gasoline.”

Overlaying an space of 6.5 million sq. meters, VW’s manufacturing facility within the metropolis of Wolfsburg makes use of two cogeneration crops that present it with warmth and energy.

The agency had been planning to switch its coal-fired boilers with gasoline and steam turbine models in a bid to decrease carbon dioxide emissions, however world occasions would seem to have prompted a rethink in the interim.

“It is all ready however now we’re somewhat bit hesitating, and we are going to look and see how the scenario goes to develop,” Diess mentioned. “We will [adapt] … to the scenario. We will, [for] somewhat bit, delay our coal-fired crops — hopefully it isn’t for too lengthy. Then we wish to change to gasoline as soon as the availability is secured.”

On Wednesday, Reuters additionally quoted Diess as telling reporters that VW had “simply determined to improve our coal-fired energy crops to nonetheless be capable of use coal or gasoline,” including that this associated to the corporate’s major operations in Wolfsburg.

VW reported outcomes for the primary quarter of 2022 on Wednesday. Working revenue earlier than particular objects hit 513 million euros (round $541 million), up from 490 million euros within the first quarter of 2021. The agency reported gross sales income of just below 15 billion euros in comparison with 17.6 billion euros within the first quarter of 2021.

Diess’ remarks got here on the identical day the European Fee, the EU’s govt department, put ahead new sanctions towards the Kremlin that can embody a six-month part out of Russian crude imports.

“We are going to part out Russian provide of crude oil inside six months and refined merchandise by the top of the 12 months,” Ursula von der Leyen, the European Fee’s president, mentioned in a speech outlining the plans.

“Thus, we maximize the strain on Russia, whereas on the similar time – and that is necessary – we reduce the collateral harm to us and our companions across the globe,” she mentioned. “As a result of to assist Ukraine, we’ve to make it possible for our economic system stays sturdy.”

Russia was the most important provider of each petroleum oils and pure gasoline to the EU final 12 months, based on Eurostat. Towards the top of April, Russia’s state-owned vitality agency Gazprom stopped provides to 2 EU nations, Poland and Bulgaria, as a result of that they had refused to pay for gasoline in rubles. The transfer led many to worry that different nations within the EU may see their provides halted too.

Geopolitical instability, the volatility of vitality markets and the Covid-19 pandemic have all sparked issues in some quarters that any transition to a world economic system centered round renewables might be delayed or prevented.

Throughout an interview with “Squawk Field Europe” on Wednesday morning, the CEO of transport big Maersk supplied a cautiously optimistic outlook.

Søren Skou mentioned “the next oil worth, all issues equal, will assist the inexperienced transition as a result of it would make the fee premiums, if you’ll, for greener fuels smaller.”

“So we see that extra as a method of accelerating the inexperienced transition than pushing it again.”

— CNBC’s Silvia Amaro contributed to this report