Sunday, May 28, 2023

Who wins and who loses in the harsh Russian sanctions game

The invasion of Ukraine changed the energy of the European Union. As the main supplier of crude oil to the Union, Russia is losing its presence on the continent as the price of a barrel falls through the floors. The Kremlin has turned its gaze to Asia, but at the cost of lower gains.

Recently, the import of crude oil from Russia has been fluctuating between 35 and 66 million barrels per month by far the largest amount of oil on the continent, especially in the eastern regions.

But the invasion of Ukraine, along with major sanctions, is aimed at disrupting the Kremlin’s ability to reduce economic warfare and its economic base. Among the sanctions was a complete ban on imports of Russian crude oil and petroleum products.

To allow markets to adjust, the ban was subject to transitional periods so that European members could provide alternative supplies while minimizing the impact on world prices.

So if in February the EU imported 64 million barrels from Russia, this figure was gradually reduced to 8.5 million; 87% less. On the other hand, the United States, Norway and the United Kingdom benefited greatly.

North Americans were in January, the month of high energy consumption, the largest supply of the EU with about 42 million cados the country’s electronic figure barely exceeded 20 million. In Scandinavia, they circled the moon 32 million compared to 22 million in January of the previous year.

The next largest supplies were Kazakhstan and Iraq with 26.6 and 23 million barrels respectively, although these are similar in number of warheads.

Nigeria, the fifth largest exporter, increased the number of barrels, as did Britain, which sent 15.7 million barrels to the Union in January, although it did not exceed 10 million before the war. Libya, Azerbaijan and Brazil also top the list of Russia’s main suppliers.

Although dependence on Russian energy has been virtually eliminated, EU citizens have suffered the most from the prices. Fuel prices have skyrocketed since the invasion of imports, reaching notable figures from which we have not recovered until this January almost a year later.

change of course

In order to overcome European sanctions, Russia has shifted its trade strategy to Asian markets. This very Tuesday, the Minister of Russian Energy Alexander Novak, showed that the export of oil to India has multiplied by 22 in 2022. In China, Russia has succeeded Saudi Arabia as the highest supplier with more than 2 million barrels per day, almost the same. to be sent before the EU war. Indeed, to negotiate the price.

As explained by the European Commission, there are two factors that determine crude oil prices: the market and the type of crude oil. Before the invasion of Ukraine, the price was stable about 80 dollars with little variation compared to the other major barrels, such as American, Norwegian, Kazakh and Libyan.

However, the high volatility in the market sent the price skyrocketing in February. A few weeks after the start of the conflict, Ural oil fell relative to the conflict. In December of last year, this was it more than 30 dollars below the rest,.

Nation World News Desk
Nation World News Desk
Nation World News is the fastest emerging news website covering all the latest news, world’s top stories, science news entertainment sports cricket’s latest discoveries, new technology gadgets, politics news, and more.
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