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Russia earned £80bn from fossil fuel exports in Ukraine war’s first 100 days

Revenue from fossil fuel exports higher than estimated £720m a day Russia spends on so-called ‘special operation’

Harry Cockburn
Environment Correspondent
Tuesday 14 June 2022 14:32 BST
The EU market accounted for 61 per cent of Russia’s fossil fuel exports during the first 100 days of the invasion of Ukraine
The EU market accounted for 61 per cent of Russia’s fossil fuel exports during the first 100 days of the invasion of Ukraine (Getty)

Despite a raft of international sanctions on Vladimir Putin’s regime following the invasion of Ukraine, Russian fossil fuel exports have earned €93bn (£80bn) over the first 100 days of the war.

The huge payments from countries including China, the EU and India – largely for oil and gas – are directly "filling the Kremlin’s war chest", according to a study by the Centre for Research on Energy and Clean Air.

The organisation has compiled a detailed dataset of pipeline and seaborne trade in Russian fossil fuels, which they describe as "a key enabler of Russia’s military buildup and brutal aggression against Ukraine".

Their data reveals that Russia earned €93bn in revenue from fossil fuel exports in the first 100 days of the war – from February 24 to June 3.

The EU imported 61 per cent of these fuels, worth approximately €57bn (£49bn).

The largest importers were China (€12.6bn), Germany (€12.1bn), Italy (€7.8bn), Netherlands (€7.8bn), Turkey (€6.7bn), Poland (€4.4bn), France (€4.3bn) and India (€3.4bn).

The report notes that despite the sanctions imposed on Russia since the invasion of Ukraine, the country’s fossil fuel earnings are likely to hit record highs.

Russia’s finance minister Anton Siluanov, recently boasted on state television that despite the looming bans on Russian fossil fuels, earnings from exports of coal, oil and gas will nonetheless grow by up to 14 billion euros this year, largely due to high prices.

He said a part of the increase in revenue will be used to fund the "special operation" in Ukraine.

The lead analyst of the report, Lauri Myllyvirta said: “The progress to date is far too slow given Ukraine’s urgent need for support. Much stronger action is needed to cut off the flow of cash to Russia. Globally, we  need to speed up the deployment of clean energy to replace fossil fuel imports and ease the high fuel prices which are driving up Russia’s revenues."

The clampdown on Russian fossil fuels meant crude oil imports into the EU fell by 18 per cent in May, but the report said despite this sizeable reduction, the unsold oil was instead taken up by India and the United Arab Emirates, leading to no net change in Russia’s crude oil export volumes.

Surging global demand for oil and gas has been key to boosting Russia’s revenue, creating "a windfall", the report said, with Russia’s average export prices an average 60 per cent higher than they were last year.

The report also found that Poland and the United States made the biggest dents in Russia’s revenue.

Last month Russia cut off gas supplies to Poland after the country refused to comply with Russia’s request to receive all payments for fossil fuels in rubles, a measure taken to prop up its currency in the face of international sanctions.

Lithuania, Finland and Estonia also reduced dependency on Russian fossil fuels by more than 50 per cent.

The report also found that the impact of the record-high fossil fuel prices along with the international drive to reduce reliance on Russian commodities has spurred greater ambition for clean energy and energy efficiency across Europe.

Russia spends an estimated €840m (£720m) a day on the invasion, with the revenue from fossil fuel exports exceeding this sum during the first 100 days, the report said.

"Ukraine’s government and civil society have been clear in their calls to terminate all fossil fuel purchases and other business with Russia’s regime, yet most countries and companies have continued to buy oil, coal and gas from the aggressor," the report’s authors said.

They noted that "there has been progress" nonetheless.

"The US and Canada have imposed fossil fuel import bans that are already in effect. The UK will phase out the imports of crude oil and oil products by the end of 2022.

"The EU has banned coal imports from August and on seaborne oil imports from December."

In total these reductions will account for up to 75 per cent of existing oil imports into Europe.

Meanwhile Germany has said it will stop oil imports by the end of the year, which will also axe the majority of the pipeline imports into Europe.

Earlier today, UN secretary general Antonio Guterres called on developed nations to end all funding for new fossil fuel projects in order to put the world on track to meet climate targets which are rapidly slipping out of sight.

“New funding for fossil fuel exploration and production infrastructure is delusional,” he said.

“It will only further feed the scourge of war, pollution and climate catastrophe.”

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