Quote (ofthevoid @ 30 Dec 2023 16:21)
Below graphic is a good representation of what happened with Russian oil in light of sanctions in the last 2 years
https://x.com/profstonge/status/1740815576694686057?s=20On a percent of total sold terms, India basically replaced EU. It's not as if India consumed all that oil but rather just arbitraged and middle manned it.
>EU places sanctions on Russia
>Russia sells discounted oil to India
>EU still needs to fill the supply gap, so they purchase oil from India, except at much higher prices compared to what they paid the Russians
>Russian oil revenue still exceeds pre-pandemic average price/barrel while Europe is still buying Russian oil, only now it's indirectly and at a much higher price
The stupidity of sanctions on a commoditized product that everyone needs.
You need to be careful to differentiate between 5 energy markets (oil products, crude oil, electricity, piped natural gas and LNG). All 5 have different levels of restrictions and specifics.
1) there are no sanctions against Russian products or crude oil per se.
2) there is a price cap in place for Russian origin products and crude which is roughly defined as “refined in Russia” and “containing more than 50% Russian product of Russian origin”.
So if you blend Russian origin with products refined in eg Turkey out of Russian crude you technically comply with all sanctions and price cap as you now export 50%+ Turkish products to Europe. Et voila.
Here is an example of Morocco that doesn’t have a single refinery supplying Europe with oil products.
https://tfiglobalnews.com/2023/05/02/morocco-made-the-best-out-of-russia-ukraine-war/(In reality it’s a bit more complicated, but you get the gist of what’s going on).
This post was edited by Malopox on Dec 30 2023 09:42am