As of: March 13, 2024, 10:40 a.m
By: Bona Hyun
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Oil revenues pour a lot of money into Putin's war chest.
The USA wants to reduce the profit margin for Russia – and lower oil prices.
Washington DC - New US measures hit Russia's vulnerability: Joe Biden's government wants to help India negotiate lower prices for Russian oil.
"At the end of the day, my goal is not to take it (the oil) off the market, I don't want to take these tankers off the market, the crude, the product," said Biden's energy adviser, Amos Hochstein.
Rather, India should be put in a position to negotiate better prices.
“I think the Indians understand what we want to do,” Hochstein told
Reuters
.
Sanctions against Russia: Putin could fear for trading partners due to low oil prices
India is one of Russia's largest oil buyers.
Russia says it has diverted almost all of its oil exports to China and India.
According to the
Tagesschau
, the two countries account for the purchase of almost 90 percent of Russian oil exports.
Russian President Vladimir Putin could soon make fewer profits in the oil business.
© Sergei Savostyanov/Pool Sputnik Kremlin/AP/dpa
45 to 50 percent of Russian oil exports alone are delivered to China, and another 40 percent to India, according to Alexander Nowak, the deputy prime minister responsible for energy.
As the US news channel
CNN
recently reported, India will also purchase 13 times as much Russian oil in 2023 as before the start of the Ukraine war.
But India could restrict trade with Russia due to fears of sanctions.
This would mean the loss of an important trading partner for Vladimir Putin.
Putin's sore point - profits from oil deals are important income for the Kremlin
At the same time, the USA wants to tighten its sanctions against tankers that transport oil above Western price limits.
The USA recently passed another package of sanctions for this purpose.
Wally Adeyemo, the US deputy treasury secretary, announced additional sanctions against Russia in connection with the Western price cap for Russian oil exports to third countries.
The aim of this tightening is "to reduce the Kremlin's revenues while allowing oil to enter the market," it said in a statement on Friday, February 23.
Among other things, the USA is hunting down Putin's ghost fleet and has put 14 tankers from the Russian state shipping company Sovcomflot on a blacklist.
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Putin is trying to circumvent oil sanctions - but can he continue to do so for long?
So far, Putin has always tried to circumvent sanctions.
But in mid-February 2024, the first signs emerged that the sanctions that had already been imposed were making Russian oil transport more difficult.
Bloomberg
reported that about half of the 50 oil tankers that the U.S. Treasury Department sanctioned on October 10, 2023 have not carried Russian cargo since then.
This information is based on tracking individual vessel data.
In addition, three major Greek shipping companies, Minerva Marine, Thenamaris and TMS Tankers, have already stopped transporting Russian oil to avoid US sanctions.
This information was confirmed
by four traders to
Reuters in November 2023.
Despite sanctions, Putin is said to have made high profits in the oil and gas business: In February 2024, revenue from oil and gas trading rose by more than 80 percent to over 10 billion US dollars compared to the same month last year,
Bloomberg reported.
But if more and more trading partners withdraw out of fear of the sanctions, it would only be a matter of time before Russia had to face massive losses from oil and gas.
(bohy with Reuters)