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Russia increases oil profits despite Western sanctions

Wednesday, 6 December 2023, 16:50
Russia increases oil profits despite Western sanctions
Stock photo: Getty Images

Russia's monthly oil profits this year are greater than before the invasion, which is evidence of the ineffectiveness of the sanctions policy of Western countries.

Source: Bloomberg

Quote: "Official Indian customs data show that the price paid for Russian oil averaged $72 a barrel this year by the time it reached the Asian country. That is $12 higher than prices declared at the point of export in Russia."


The imposition of sanctions that capped the price of Russian oil led to the expansion of the so-called "shadow fleet," which has served as a substitute for obtaining Russian oil outside of the sanctions framework.

This year, about 45% of Russian oil exports were carried out through shadow schemes, which was a highly effective method until Western countries found effective counteraction.

Quote: "Russia’s net oil revenues of $11.3 billion in October accounted for 31% of the nation’s overall net budget revenue for the month. That was the highest since May 2022 and exceeded any single month in the year before the invasion of Ukraine."

However, Russia’s sanctions evasion did not go unnoticed. As noted, the US Treasury Department now wants to make Russia pay more for oil transportation. 

Background: The introduction of a US$60 per barrel "price cap" on Russian oil could have dealt a significant blow to the Russian military economy, but these restrictions were only effective when they were first introduced.

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