A coalition of Western democracies have taken steps to limit Russia’s exports of crude.
The main objective of these measures is to curb Russia’s financial resources and put pressure on their government to resolve the ongoing conflict in Ukraine.
The group of countries has agreed on new price restrictions for Russia’s oil products, with an aim to keep the global energy market supplied while reducing Russia’s revenue from their domestic oil industry.
Western governments impose oil sanctions
On top of the price restrictions, the EU has also imposed a ban on the import of Russian oil products, which comes into effect soon. The impact of Western sanctions on Russia’s most profitable export has already resulted in Russia’s monthly budget revenue from oil and gas falling to its lowest level in over a year.
However, there seems to be a plan in place to cope with the forced embargo, the price restrictions, and the shortage of tankers. Data from traders has shown that Russia is planning to increase its diesel exports in the near future to deal with the current situation.
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The global energy market continues to remain well-supplied
With countries like China and India using the restrictions as an opportunity to secure good deals on Russian crude.
These developments in the global energy market are worth keeping an eye on. Although the IMF has raised its growth projections for Russia, a senior Treasury official remains convinced that the price restrictions are changing their budget trajectory as domestic crude is the country’s main source of the country’s revenue.
It’ll be interesting to see how this all plays out in the coming days and weeks. As always, stay informed and stay curious!