How Russia Is Surviving the Tightening Grip on Its Oil Revenue


Using customs data from India, Mr. Vakulenko, the Russian oil expert, showed that local importers of Russian crude paid almost the same price as Brent crude. A New York Times analysis of the same data produced similar results.

The explanation, Mr. Vakulenko suggested, is that at least part of the large discount on the quoted Urals price had been pocketed by Russian exporters and intermediaries, who then charged a higher price to the buyers in India.

This revenue will not accrue directly to the Russian government in taxes, said Tatiana Mitrova, a Russian oil expert at the Center on Global Energy Policy at Columbia University. But because the Russian exporters probably have close ties to the Kremlin, some of money might still support the war effort, she said.

“It’s a complete black box of funds,” she said.

Experts agree that in the longer term, the future of Russian oil revenues will be decided by global economic forces beyond the control of Western sanctions enforcers and Russian evaders.

They say global oil prices will remain the single biggest determinant of how much money the Kremlin will collect from a barrel of exported crude, despite the growing opacity of its trade.

And the fate of that price rests to a large extent on Russia’s ally China, whose economy is just beginning to emerge from years of strict Covid restrictions. In December, China’s imports of crude oil hit a record of 16.3 million barrels a day, according to estimates by Kpler, a firm that tracks energy shipping. If the trend continues, it will strain global oil supplies and benefit the Kremlin.

Adding to the upward pressure on oil prices, OPEC Plus, an alliance of Russia and the Organization of the Petroleum Exporting Countries, said last Wednesday that it would maintain last year’s restrictive output targets, which could strain oil supplies if demand grows.



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *