Russia's oil and gas revenues have plummeted due to Western sanctions and falling fossil fuel prices, significantly impacting sales.
Under the pressure of Western sanctions, Russia's oil and natural gas revenues have fallen to their lowest level since the start of the Ukraine war in 2022, according to data from the Center for Energy and Clean Air Research (CREA).
The decline in revenues is attributed not only to sanctions but also to the decrease in global fossil fuel prices. Due to sanctions, the price of Urals oil, which is Russia's main export type, is trading at about 40% lower compared to Brent oil. The surplus in the market and the decrease in export volumes also indicate that sales have slowed despite discounted prices.
CREA data reveals a significant drop in sales, particularly to Indian refineries. Accordingly, Russia is earning less than half of the revenue it generated from oil and gas exports at the beginning of 2022, prior to the war.
India Diversifies Its Purchases
According to the research, India has begun to turn to alternative suppliers, primarily Iraq, by reducing its purchases of Russian oil. The Jamnagar refinery completely halted deliveries of Russian oil in January, but new shipments are expected to resume in February.
U.S. Secretary of State Marco Rubio claimed that India agreed to stop purchasing Russian oil in exchange for a reduction in U.S. customs tariffs. This statement reiterated a similar assessment made by U.S. President Donald Trump earlier in the month. However, the New Delhi administration did not confirm the claim.
Indian Foreign Minister S. Jaishankar stated that energy markets operate based on price and supply signals, and that the country's foreign policy is based on the principle of 'strategic autonomy.'
Tatiana Mitrova from Columbia University's Center on Global Energy Policy characterized the developments as a 'tactical adjustment,' noting that refineries have limitedly reduced their volumes and are turning towards non-sanctioned types of oil.
Russian Foreign Ministry Spokeswoman Maria Zakharova rejected claims that India had changed its stance, arguing that Russian hydrocarbon trade is beneficial for both countries and contributes to global market stability.
China and Turkey Increase Purchases
According to Bloomberg, India is expected to soon decide whether to renew the licenses of insurance companies connected to Russia. The decision is considered likely to have an impact on relations with both Moscow and Washington.
It is noted that the portion of Russian oil that cannot be sold is increasingly directed towards China. In January, Russia's share of China's total crude oil imports rose to 16%, nearing the informal 20% cap that Beijing has imposed on suppliers.
Turkey also increased its purchases during the same period, importing approximately 8% more oil from Russia throughout the month.
Source: SeaNews Türkiye
