Two years since Russia’s full-scale invasion of Ukraine, despite a range of sanctions and embargoes, Russian fossil fuels continue to flow into the European Union and boost the Kremlin war chest.
CREA’s analysis reveals that while existing sanctions have cut Russian revenues from fossil fuels exports by 12%, the EU continues to fund the invasion, buying EUR 28.1 billion of Russian fossil fuels in its second year, more than double the Union’s annual financial support to Ukraine. Since the beginning of the war, the average EU citizen has paid an estimated EUR 420 for Russian fossil fuels.
Due to lagging government energy policies, citizens of Slovakia (EUR 525), Hungary (EUR 440), Belgium (EUR 188), Czech Republic (EUR 188) and Austria (EUR 185) — considered allies of Ukraine — have continued to contribute heavily to the Kremlin’s war chest in the second year of the invasion. It is clear evidence of how Russian fossil fuels continue to not just fund Putin’s invasion of Ukraine, but also devalue and slow down the EU’s green energy transition.
While the sanctions have impacted Russian revenues, there is huge potential for Ukraine’s allies to do more.
After two years of full-scale invasion, Russia continues to receive cash from exporting its energy resources, including from oil. Part of the blood money pumping to Russia goes in a form of revenue from refined products produced from its oil in third countries and imported by the coalition countries.
CREA’s study clearly shows that these activities should be stopped immediately. A full ban on refined products produced from Russian oil should be introduced as soon as possible.
Oleg Ustenko, Economic advisor to the President of Ukraine
The EU/G7 ban on Russian crude and the introduction of the price cap policy in December 2022 cut Russian revenues from crude oil by 17% (EUR 23.7 bn) — equivalent to EUR 1.6 bn per month. The ban on oil products and associated price caps implemented in February 2023 cut Russian export revenues from oil products by 18% (EUR 8.9 bn) — equivalent to EUR 606 mn per month.
A ban on LNG flows and pipeline gas to the EU, for example, could cut Russian export revenues by EUR 632 mn per month and EUR 497 mn per month, respectively.
The Centre for Research on Energy and Clean Air (CREA) continues to deliver invaluable analysis and recommendations on Russian energy sanctions. Their well-presented data sets track critical financial and volume flows and help reveal the broader picture. A must read for policy makers and the broader public.
Dr. Craig Kennedy, Center Associate, Davis Center, Harvard University, Author of ‘Navigating Russia’
