Russian Fossil Fuel Revenues Double Despite Western Sanctions

The longer Western sanctions isolate Russia and reduce energy supplies to European refiners. The higher energy prices will go. Even though Russian energy exports are declining, higher prices have enabled the country’s state-owned oil and gas companies to double revenue, thus stabilizing the ruble and allowing financing for President Putin’s military machine.

According to The Guardian, citing a new report of shipping movements by the Centre for Research on Energy and Clean Air (CREA), Russia has reaped a whopping €62 billion from oil, gas, and coal exports since the invasion of Ukraine began.

Russian exports to energy-stricken Europe totaled €44 billion in the last two months, compared with €140 billion for FY’21. The revenue surge comes as “Russia has continued to benefit from its stranglehold over Europe’s energy supply, even while governments have frantically sought to prevent Vladimir Putin from using oil and gas as an economic weapon,” CREA said.

CREA data showed Russian crude oil exports tumbled 30% in the first three weeks of April, compared with rates in January and February, before the invasion. However, soaring prices because of tight global supplies have helped cushion the blow of Western sanctions and ultimately allowed Putin to continue his funding war efforts.

“Russia has effectively caught the EU in a trap where further restrictions will raise prices further, cushioning its revenues despite the best efforts of EU governments,” CREA explained. 

“Fossil fuel exports are a key enabler of Putin’s regime and many other rogue states,” Lauri Myllyvirta, lead analyst for CREA, said.- READ MORE