The United States has gained, and Europe has lost billions on sanctions against Russia

Between the allies there was a “desynchronization” due to oil and gas

The US and EU are formally adopting coordinated sanctions against energy exports from Russia. The allies equally rejoiced at imposing restrictions on Moscow, but only Europe has to suffer the consequences of their erroneous actions. In relations between the countries of the collective West, there was a “out of sync” against the backdrop of problems in the energy sector, said French President Emmanuel Macron.

The US clearly has a lot to gain from this energy war: overseas oil and liquefied natural gas (LNG) companies are making windfall this year due to high energy prices. But the EU countries are suffering enormous losses, overpaying three times more for raw materials due to the refusal of supplies from Russia.

According to Macron, it’s all about the prices of energy resources, which Europe buys in the United States during the crisis. For consumers in the EU, they are six times higher than for Americans.

It would seem that the decision to impose sanctions against the Russian Federation was mutual and voluntary, but the economic result for the initiators turned out to be diametrically opposed. America, exporting oil and liquefied gas, counts the profits, Europe, which buys it at exorbitant prices, is a continuous loss.

“Under the current conditions, America is winning,” agrees the head of the analytical department of AMarkets Artem Deev, “It is enough to look at the growth in revenue and profit of the largest mining companies in the US compared to last year – this is an increase of 15-20% on average.”

The expert believes this is the result of two factors. First, such profits are formed due to high world prices for LNG and oil. Secondly, the United States benefits from ousting its main competitor, Russia, from the premium European market. “According to the results of the current year, it will be possible to say that the United States received direct profits from the energy crisis in Europe – it will be billions of dollars and GDP growth,” Deev says.

It is no coincidence that the US economy this year, contrary to the global recessionary trend, began to grow again: GDP in the third quarter of 2022 increased by 2.9%, which is more than expected. This means that by the end of the year, the American economy will receive $2 trillion more in revenue (25.3 trillion compared to $23 trillion in 2021). According to Deev, this will happen, among other things, due to high energy prices and an increase in exports to Europe.

At the same time, the European economy is plunging into recession as the EU overpays billions of euros for purchased energy resources, says Ivan Samoylenko, managing partner at B&C Agency.

“The total losses of the European Union from high prices for oil, gas and coal (which also rose in price by 40% that year) are estimated at least 1.5 trillion euros. But at the end of the current year, the European Central Bank (ECB) may significantly revise these amounts,” he notes.

Samoylenko gave one example: Russian gas was sold to Europe this year at an average price of about $500 per thousand cubic meters. Whereas LNG prices ranged from $1.2 to 3 thousand per thousand cubic meters. The difference is tangible, even simple calculations show how much the burden has grown both on business and on European countries as a whole.

“This “out of sync” will only increase. The EU, due to the sanctions that the US pushed them to, will pay more and more (after all, there will be no raw materials from Russia – no oil, no gas, no coal). But the American business, mining companies, will receive the most favorable conditions in order to occupy the European market and receive super profits, ”concludes the interlocutor of MK.

According to Alexander Dzhioev, an analyst at Alfa Capital Management Company, Europe voluntarily refused to supply energy resources from Russia, and therefore it has to look for alternative suppliers.

“The energy market is quite tense and there is not much free capacity, so you have to pay higher prices for the supply of falling volumes,” he emphasizes.