The expected effect of the restrictions was not achieved: the effect of the price ceiling began to weaken in the second half of 2023.
Over the year, Russia’s income from oil exports fell by 34 billion euros. The Russian oil price cap, which was introduced on December 5, 2022, reduced the Kremlin’s oil revenues by 14%, but the effect began to weaken in the second half of 2023. This was stated in a report by the Center for Research on Energy and Clean Air (CREA).
Noting that a year ago, when the $60 per barrel price restrictions and ban on Russian crude oil imports came into effect, European Commission President Ursula von der Leyen said: “This decision is more will hit Russia’s revenues and reduce its ability to wage war in Ukraine.” Sanctions throughout the year have not diminished the Kremlin’s decision to go to war, but CREA’s analysis shows that the EU’s oil import ban and the G7 price caps reduced Russia’s oil export earnings by 14%, depriving Russia of €34 billion in export earnings.
It was noted that the expected effect was far from being achieved: the effect of the price ceiling began to weaken in the second half of 2023.
“CREA’s analysis shows that the sanctions significantly affected Russia’s oil export revenues in the first half of the year, with losses rising to €180 million per day in the first quarter of 2023. In January 2023, Russia sees a significant 45% monthly decline in total fossil fuel revenues fuel, with revenue from the sale of crude oil alone falling by 25%. However, the failure to implement, enforce and continuously monitor the limits of price allowed Russia to reverse this effect in the second half of the year and then resume revenues at €90 million per day in the last quarter of the year.The effectiveness of sanctions has decreased due to insufficient monitoring and weak implementation of the oil price cap policy, which allows Russia to sell its oil at prices above the limit,” the report said.
It was previously reported that the US Treasury sent letters to 30 companies that control up to hundreds of oil tankers warning of imprisonment in the event of a breach of the price ceiling for Russian oil.
Source: korrespondent
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