Russia is thumbing its nose at the US-led Western sanctions on the back of $ 60 billion in crude oil sales. In comparison, the whole of 2021 had seen oil revenue total $ 120 billion. The revenue Moscow has earned since February-end when it attacked Ukraine has exposed an international divide in responding to Russia.
This comes despite oil production reportedly dropping by around 700,000 barrels a day. Some exports have been diverted to Turkey and Italy, both posting far bigger orders in April compared to last month.
US Treasury Secretary Janet Yellen admitted banning Russian oil and gas could hurt Europe severely — while having “very little negative impact on Russia.” German Chancellor Olaf Scholz also warned of a “dramatic economic crisis” if a total embargo is imposed.
Indian contribution to Russia
Russian oil sales to India since the invasion of Ukraine are already more than double their 2021 total, according to Reuters.
Indian refiners have purchased nearly 40 million barrels of Russian crude since 24 February, up from 16 million barrels bought in all of 2021, Reuters calculated.
The soaring sales come amid steep discounts for Russian crude as Moscow’s war on Ukraine has resulted in other customers shunning its supplies.
While the European Union has yet to impose a full-scale embargo on Russian oil, so-called self-sanctioning among oil companies has still hit demand. Meanwhile, New Delhi has stressed the need for a ceasefire in Ukraine but has yet to condemn Russia’s actions or President Vladimir Putin.
Indian refiners say the Russian oil is necessary to offset price shocks to consumers given skyrocketing inflation. Oil Minister Hardeep Singh Puri said on Friday that the imports from Russia only account for a small fraction of India’s overall supply needs.
India — the world’s third largest importer of oil — gets 85% of its oil to supply from other countries.
Despite the reluctance to buy Russian oil, it is still reaching the global market. More and more exports are marked “destination unknown” as the industry looks for ways to continue doing business with Moscow during its war on Ukraine.
So far in April, more than 11.1 million barrels have been loaded onto cargoes with unknown destinations, compared to nearly zero prior to the invasion, according to the Wall Street Journal, which cited data from TankerTrackers.com.