Russia doubles fossil fuel revenues since invasion of Ukraine began
Russia has nearly doubled its revenues from selling fossil fuels to the EU during the two months of war in Ukraine, benefiting from soaring prices even as volumes have been reduced.
Russia has received about €62bn from exports of oil, gas and coal in the two months since the invasion began, according to an analysis of shipping movements and cargos by the Centre for Research on Energy and Clean Air.
For the EU, imports were about €44bn for the past two months, compared with about €140bn for the whole of last year, or roughly €12bn a month.
The findings demonstrate how Russia has continued to benefit from its stranglehold over Europe’s energy supply, even while governments have frantically sought to prevent Vladimir Putin using oil and gas as an economic weapon.
Even though exports from Russia have been reduced by the war and sanctions, the country’s dominance as a source of gas has meant cutting off supplies has only increased prices, which were already high because of tight supply as global economies recovered from the Covid-19 pandemic. Crude oil shipments from Russia to foreign ports fell by 30% in the first three weeks of April, compared with rates in January and February, before the invasion, according to the CREA data.
But the higher prices Russia can now command for its oil and gas mean its revenues, which flow almost directly to the Russian government through state-dominated companies, have risen even while sanctions and export restrictions bite. Russia has effectively caught the EU in a trap where further restrictions will raise prices further, cushioning its revenues despite the best efforts of EU governments.
Lauri Myllyvirta, lead analyst for CREA, said the cash propped up Putin’s war effort, and the only way to
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