by Robert Rapier at Oil Price
- Russia’s oil and gas revenues hit another record high despite sanctions designed to hurt the Russian economy.
- The removal of some Russian oil from markets only served to send oil prices higher, boosting revenues from the oil that it is able to sell.
- There is no way to remove Russian oil from the market entirely without sending oil prices much higher, possibly above $200.
As I warned in my February article Russia Is A Major Supplier Of Oil To The U.S., Russia could potentially benefit from the sanctions on its oil exports. Although Russia hadn’t yet invaded Ukraine when I wrote that article, I warned that if it did:
“Russian sanctions would be put in place, potentially reducing the available oil supply in a tight market. If Russia could still sell all the oil it could produce to countries that refuse to abide by the sanctions, it might do well financially with an oil price spike.”
We now have data in hand to confirm that the subsequent sanctions on Russia’s oil are in fact boosting Russia’s oil revenues:
New data! #Russia‘s oil and gas revenues hit another record high in April. 1.8 trillion rubles in a single month, after 1.2 trillion in March. After only 4 months, Russia’s federal #budget has now already received 50% of the planned oil and gas revenue for 2022 (9.5 trillion). pic.twitter.com/DKUGClchWG
— Janis Kluge (@jakluge) May 6, 2022
Although the U.S. has stopped buying Russian oil…
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