Ross Clark Ross Clark

Is the western boycott of Russian oil backfiring?

Credit: Getty images

Ukraine’s ability to defend itself against the Russian invasion has surprised almost everyone outside the country, none more so, presumably, than Vladimir Putin. As for the West’s efforts to harm Russia through sanctions on its fossil fuel exports, that is a very different matter. Sanctions have not been entirely useless. According to a report by the think tank Centre for Research on Energy and Clean Air (CREA), they have led to Russia losing over €200 million (£173 million) a day relative to what it was earning at the start of the year: €880 million (£692 million) per day in May compared to €1.1 billion (£951 million) per day in January and February. But, thanks to much higher oil and gas prices caused in part by the invasion of Ukraine itself, Russia is still earning more revenue than it did last year.

Is the pain being inflicted on European industries and consumers through higher energy prices really worth it?

In the first 100 days following the invasion on 24 February, the CREA says Russia earned €93 billion (£80 billion) from its oil exports. Of that, €57 billion (£49 billion) was earned from exports to Europe. For all of Europe’s efforts to wean itself off Russian oil and gas, much of the gap left by the reduction in European fuel exports is being plugged by other countries. China has overtaken Germany as Russia’s biggest fossil fuel customer, taking €12.6 billion (£10.9 billion) worth since the invasion. According to the CREA’s report, others who have upped their imports of Russian oil include India – 18 per cent of whose crude oil imports now come from Russia, compared with one per cent before the invasion – and, somewhat surprisingly, UAE and Saudi Arabia.

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