As western countries seek to pry themselves off Russian fossil fuels, Russia’s gas revenues have been dented but are still better than in 2021. Putin’s regime has also found new outlets for crude oil sales in India and the Middle East.
On June 13th, the Center for Research in Energy and Clean Air released a report on Russian fossil fuel sales during the first hundred days of its invasion of Ukraine. According to the report, Russian export volumes fell slightly (15%) in the first hundred days since the outbreak of war, costing Russia EUR 200 million a day, but are still strong. This is largely thanks to a windfall created by rising prices. In fact, throughout May export prices were on average 60% higher than in 2021.
Despite losses, Russia still brought in around EUR 93 billion over the hundred-day period.
Overall, during the first hundred days of the war, EU gas imports from Russia have declined by 23%. In the first two weeks, countries scrambled to secure fuel and imports spiked. Afterwards, they declined, falling 30% year-on-year in May.
“Poland and the United States made the largest dents in Russia’s revenue,” the report stated. “Lithuania, Finland and Estonia achieved sharp percentage reductions of more than 50%.”
“However, Gazprom’s revenue is still twice as high as the year before, due to high prices,” the report stated.
India and the Middle East have become a significant outlet for Russia crude oil sales, as well as a loophole for the US and European countries to continue importing Russian oil via third countries that have not imposed stringent sanctions on Putin’s regime. According to the report, India is now buying 18% of the country’s crude oil exports, a significant portion of which is then sold back to European countries and the US as refined oil, often at discount prices.
Russia’s new trade arrangements require more shipping, most of which is being done by European and US shipping companies.
“In April-May, 68% of deliveries of Russian crude oil were made with ships owned by EU, UK and Norwegian companies, with Greek tankers alone carrying 43%,” the report said. “For deliveries to India and the Middle East, the share was even higher at 80%. 97% of the tankers were insured in just three countries, UK, Norway and Sweden.”
Shipping companies are also sailing on a windfall, as shipping prices are at record highs.
The EU has not put an embargo on Russian gas, but sanctions on Russian coal and oil are due to go into effect at the end of the year.