Russia has reaped huge revenues from high fossil fuel prices, report says
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Since the start of the war in Ukraine, the main importer of Russian fossil fuels has been the EU, followed by China and Turkey.
Russia has raked in 158 billion euros in revenue from fossil fuel exports in six months of war, taking advantage of high prices, according to a report by an independent research center published on Tuesday (September 6th), which calls for more sanctions efficient. “Soaring fossil fuel prices mean that Russia’s current revenues are well above those of previous years despite reductions in export volumes”underlines the report of the Center for research on energy and clean Air (CREA), based in Finland.
Gas prices soared to historic levels in Europe, while oil prices soared at the start of the war before falling more recently. “Fossil fuel exports are estimated to have contributed 43 billion euros to the Russian federal budget, helping to finance war crimes in Ukraine”, the authors calculated. These figures were estimated for the first six months of the war following the invasion of Ukraine by Russia, from February 24 to August 24.
Read alsoWar in Ukraine: Do Western sanctions really enrich Russia?
“Russia failed to find other buyers”
Over this period, the CREA estimates that the leading importer of Russian fossil fuels was the European Union (for 85.1 billion euros), followed by China and Turkey. The EU has decided on a gradual embargo on its imports of petroleum and petroleum products. It has also already put an end to its coal purchases, but Russian gas, on which it is very dependent, is not currently concerned. The research center believes, however, that the European embargo on coal – implemented on August 10 – has paid off, with Russian exports having since fallen to their lowest level since the invasion of Ukraine. “Russia failed to find other buyers”write the authors of the report.
Read alsoRussian oil price cap causing global market ‘uncertainties’, Moscow says
The CREA, on the other hand, considers that rules “stronger” must be put in place to prevent Russian oil from entering markets where it is supposed to be banned. Western sanctions are today too easily circumvented, according to him. “The EU must ban the use of European ships and ports for the transport of Russian oil to third countries”, he thinks so. The United Kingdom is also called upon to ban the participation of its insurance sector in such international transport.
For their part, the G7 countries decided on Friday to cap “urgently” the price of Russian oil, a complex mechanism to put in place and intended to deal a new blow to Moscow’s energy windfall.
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