Exports of Russian crude oil and petroleum products rose to their highest level in nearly three years in March, despite Western sanctions against the country over its invasion of Ukraine. This is reported by the International Energy Agency (IEA) in its monthly oil market report.
According to the IEA, total oil shipments from Russia averaged 8.1 million barrels daily, up 600,000 barrels (159 litres) from a month earlier. In addition, the amount of exported petroleum products, in particular, increased. Russia now mainly exports a lot of oil to India and China, for example, because of Western sanctions, such as the European Union’s oil embargo and the price cap on Russian oil.
Because of these sanctions, traders can haggle considerably on prices, putting pressure on Russia’s oil income. Oil exports brought in $12.7 billion for Russia last month. Although that is 1 billion dollars more than in February, it is a decrease of 43 percent compared to a year earlier. With the sanctions, the West wants to limit Moscow’s financial resources for its war in Ukraine.
The IEA also writes in the report that the production cuts by OPEC+ increase the chances of a shortage in the oil market in the second half of this year. OPEC+ will cut production further to prop up prices. This has already led to a significant increase in oil prices recently. The IEA says those higher prices could drive inflation back up, causing additional pain for consumers, particularly in poorer countries.
OPEC, led by Saudi Arabia, reported on Thursday that a deficit in the global oil market is likely to arise in the fourth quarter. OPEC+ is the oil cartel’s partnership with countries such as Russia.
