Russia, Sanctions, and the Global Oil Market

India, China growing markets for shunned Russian oil

India and other Asian nations are becoming an increasingly vital source of oil revenues for Moscow despite strong pressure from the U.S. not to increase their purchases, as the European Union and other allies cut off energy imports from Russia in line with sanctions over its war on Ukraine. Such sales are boosting Russian export revenues at a time when Washington and allies are trying to limit financial flows supporting Moscow’s war effort...

Ukraine war: Russia earns $97bn on energy exports since invasion

Revenues have been falling since March, as many countries shunned Russian supplies, but remain high, the independent Centre For Research on Energy and Clean Air (CREA) found. It also warned of potential loopholes in efforts to curb imports from Russia. The EU, US and UK are among those to have pledged to cut Russian imports. But the CREA report found Russia still earned $97bn in revenue from fossil fuel exports in the first 100 days of the Ukraine conflict, from 24 February to 3 June. The European Union made up 61% of these imports, worth approximately $59bn...

Asia is buying discounted Russian oil, making up for Europe’s cutbacks

A surge in demand from Asia for discounted Russian oil is making up for the sharply lower number of barrels being sold to Europe, dulling the effects of the West’s efforts to punish Moscow over its invasion of Ukraine and keeping revenue flowing to the Kremlin. Most of the additional oil has gone to two countries: China and India. China’s imports of Russian oil rose 28 percent in May from the previous month, hitting a record high and helping Russia overtake Saudi Arabia as China’s largest supplier. And most of the increase went to India, which has gone from taking in almost no Russian oil to bringing in more than 760,000 barrels a day, according to shipping data analyzed by Kpler, a market research firm... “Asia has saved Russian crude production,” said Viktor Katona, an analyst at Kpler. “Russia, instead of falling further, is almost close to its prepandemic levels”...

Oil extends gains as major producers flag capacity limits

Oil prices rallied for a third day on Tuesday as major producers Saudi Arabia and the United Arab Emirates looked unlikely to be able to boost output significantly while Western governments agreed to explore ways to cap the price of Russian oil... UAE Energy Minister Suhail al-Mazrouei said on Monday that the UAE was producing near maximum capacity based on its quota of 3.168 million barrels per day (bpd) under the agreement with OPEC and its allies, a group known as OPEC+. Analysts also said that political unrest in Ecuador and Libya could tighten supply further...

Macron Tells Biden That UAE, Saudi Can Barely Raise Oil Output

Two top OPEC oil producers, Saudi Arabia and the United Arab Emirates, can barely increase oil production, French President Emmanuel Macron on Monday said he had been told by the UAE's president... "I had a call with MbZ," Macron was heard telling U.S. President Joe Biden on the sidelines of the G7 summit, using shorthand for UAE leader Sheikh Mohammed bin Zayed al-Nahyan. "He told me two things. I'm at a maximum, maximum (production capacity). This is what he claims." "And then he said (the) Saudis can increase by 150 (thousands barrels per day). Maybe a little bit more, but they don't have huge capacities before six months' time," Macron said...

Putin’s Oil War With the West Comes at His Allies’ Expense

As Russia pushes to find new buyers for its oil to skirt ever tougher Western sanctions, it is cutting into the market share of two of its allies — Iran and Venezuela — and setting off a price war that could hurt them all. The competition for sales to Asia has already forced Venezuela and Iran to sharply discount their crude to try to hang onto the few available outlets for their own sanctioned exports, according to oil analysts and traders. And although both Iran and Venezuela profess publicly to remain close to Russia, experts expect that if the oil battle intensifies it will raise tensions with the Kremlin even as its leader, Vladimir V. Putin, works to shore up his alliances...

Russian fuel use by US military drives congressional push for energy independence on bases in Europe

Russian fossil fuels have long helped power American military bases in Europe. Ramstein Air Base in Germany, the largest hub for U.S. troops and military supplies on the Continent, consumes Russian gas to the tune of more than $4 million yearly, according to an April analysis by Brown University’s Climate Solutions Lab. Collectively in Europe, U.S. installations have relied on Russian natural gas, oil and coal for 30% of their energy needs. That dependency is now partly fueling Russia’s war effort against Ukraine and a renewed push in Congress to reduce the U.S. military’s reliance on Russian-sourced energy...