The dependence on Russian natural gas in Germany is so great that if supplies from Russia were to be stopped and the remaining quantities of natural gas distributed to Europe, Germany would have to reduce its natural gas consumption in the heating gas sector or in the industrial sector by 100 TWh per year .

Speaking to the Bundestag parliament, Scholz said German will continue to look to reduce its dependency on Russian oil and gas but warned "hasty" action could trigger a recession.

"If oil is sold at a discount, then [consumers] will be happy to buy it. We will earn less, but we will be able to place oil," Novak said.

The European Commission said in a statement on Tuesday that the sanctions included "a far-reaching ban on new investment across the Russian energy sector".

But events in Europe may cause a rethink about natural gas, both as a transition fuel in the United States and a foreign policy tool.

In response to the tougher sanctions, Russian President Vladimir Putin on Feb. 27 ordered nuclear deterrent forces on high alert, further escalating tension.

Blocking energy flows and banning Russia from the international financial messaging service SWIFT – two potential responses to Russia's military invasion of Ukraine – remain on the table but were not pursued in the latest sanctions package from the US.

"The European Council today agrees on further restrictive measures that will impose massive and severe consequences on Russia for its action, in close coordination with our partners and allies," the council said.

"To be clear: these measures are separate from and would be in addition to the swift and severe economic measures we have been preparing in coordination with Allies and partners should Russia further invade Ukraine," Psaki said.

Austrian oil company OMV is one of Russian gas giant Gazprom's partners in the pipeline project connecting Russia to Germany, which has been completed but is not yet operational as it is awaiting German and EU regulatory approval.