Russia's oil exports have surged to their highest level since the country's invasion of Ukraine, generating $1.7 billion in additional revenue despite Western sanctions, according to the International Energy Agency (IEA). The Paris-based organization reported that Russian exports rose by 50,000 barrels per day to reach 8.3 million bpd in April, indicating that the country did not fully follow through on its threat to significantly reduce production.
The IEA suggested that Russia may be boosting its export volumes to compensate for lost revenue. The country's oil export revenues increased by $1.7 billion to reach $15 billion in April. However, this figure represents a 27% decrease compared to the same month in 2022, and Russia's tax receipts from the oil and gas sector declined by 64% year-on-year.
To curtail a key source of funding for Russia's war on Ukraine, the Group of Seven (G7) nations, Australia, and the European Union (EU) have implemented price caps on Russian petroleum products and crude, along with embargoes on the country's key oil exports. In response, Russia has threatened to sever ties with countries and companies that comply with the price cap. Additionally, Russia has announced a production cut of 500,000 barrels per day, while its allies in the OPEC+ group, including Saudi Arabia, have agreed to reduce output.
The IEA noted that Russia's crude oil production remained relatively stable at 9.6 million barrels per day in April, but the country needs to cut an additional 300,000 barrels per day in May to align with the agreed-upon production levels. The agency highlighted that Russia appears to have no difficulty finding willing buyers for its crude and oil products, often at the expense of fellow OPEC+ members in the two-tier market that has emerged due to the embargoes.
China and India are the primary destinations for Russian crude exports, accounting for nearly 80% of the total. The IEA expects China's recovery from COVID-19 restrictions to boost global oil demand, raising its forecast by 2.2 million bpd to an average of 102 million bpd, surpassing previous expectations.
Note: This news article has been written by an AI language model and does not reflect the views or opinions of any individuals or organizations mentioned in the text.
