Date: 28 March 2023 Author: Grzegorz Kuczyński

Russian Oil Revenues and Exports Fall Amid Sanctions

February crude oil and product exports averaged 7.5 million barrels a day, the lowest since September 2022 and a drop by 0.5 million bpd from January 2023. The flow of money into the country from international oil sales fell to $11.6 billion in February, down 43 percent from a year earlier and down $2.7 billion from January 2023.


Those that were hit most were Russian oil exports to Europe. Before the invasion in 2022, EU states secured 4 million bpd compared to only 580,000 bpd in February 2023, a whopping decline from January this year. In February, Russia sent 70 percent of its total oil exports to China and India. Russian oil now accounts for 40 percent and 20 percent of total crude imported by India and China, respectively. Despite sanctions, Moscow has seen shrinking fossil fuel revenues to support its federal budget and war effort since last summer. According to the IAE, Russia earned $20.3 billion in January 2022, $20.5 billion in February 2022, $22.1 billion in March 2022, $20.7 billion in April 2022, $21.1 billion in May 2022, $21.6 billion in June 2022, $19 billion in July 2022, $18 billion in August 2022, $15.7 billion in September 2022, $17.5 billion in October 2022, $15.9 billion in November 2022, $13.3 billion in December, $14.3 billion in January 2023, and $11.6 billion in February 2023. Unsurprisingly, Russia will continue a 500,000 barrels per day oil production cut until the end of June. Russian Deputy Prime Minister Alexander Novak said the move was targeted at reducing discounts on Russian oil and ensuring stable supplies. Russia is no longer capable of maintaining its level of sales from a year ago amid Western sanctions. According to the International Energy Agency (IEA), Russia’s total output of oil and petroleum products in 2023 averaged 10.4 million barrels per day (bpd), a drop by 0.74 million bpd year-on-year. Seaborne oil product exports have been hit by sanctions as their journey takes far longer–– around 50–60 days, according to the Russian energy deputy minister. The lengthy oversea shipment contributes to higher delivery prices. The European Union’s ban on Russian oil product exports, which entered into force on February 5, 2023, was also a hit to Russian exports last month. Consequently, Russia has diverted its energy export supplies to Africa and Asia. Seaborne Russian oil exports averaged 2.13 million bpd, down 21 percent from January (2.7 million bpd) and 24 percent from Russia’s average export levels before the full-scale invasion of Ukraine. The largest impact has been felt in the diesel and fuel oil markets.

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