The ECB assessed the impact of sanctions on Russian imports

A new edition of the Economic Bulletin of the European Central Bank (ECB) analyzes changes in trade supplies from Russia since the start of the Russian military operation in Ukraine. Energy and agri-food flows are tracked by ECB analysts using data on shipping and gas supplies, and imports to Russia are summarized based on statistics from its main trading partners.

According to the ECB, the volume of Russian oil exports by sea in early July actually recovered to levels that were observed before the conflict. This happened against the backdrop of historically high discounts on Russian oil (the discount for Urals to Brent is 30%) and a partial redirection of supplies to major Asian countries. The share of Russia in the volume of oil imports by sea by China and India at the end of June increased to 11% and 14%, respectively, compared with 6% and 2%, which were before the outbreak of hostilities. Deliveries to the US and the UK were reset to zero. Russian gas exports to the EU have declined significantly, amounting to 35% of last year’s level in the last week of June.

At the same time, exports to Russia of the countries that are the main trading partners have significantly decreased (see chart). This is especially noticeable in countries that have imposed sanctions. In May, an 85% decrease in the import of goods to the Russian Federation from the United States and 45% from the euro area countries was recorded. At the same time, exports from countries that did not impose sanctions, such as China, also fell by 23%.

Based on a sample of Russia’s 59 trading partners, covering 86% of Russian imports, the ECB estimates that the package of sanctions imposed in March 2022 resulted in imports from countries that imposed restrictions being 20 percent higher than in February. points lower than those that did not join them. First of all, this happened due to a decrease in the import of vehicles, base metals, machinery and equipment. “The breakdown by individual groups shows that Russia’s access to goods needed for the production of military equipment, such as vehicles, machinery and mechanical devices, in relative terms, was significantly hindered,” the ECB said. They believe that only the first round of sanctions led to a decrease in Russian imports by 15%.

Alexey Shapovalov