“Russia’s Oil Export Profits Slump by Almost a Third in Q1 2023 Due to Western Price Ceilings”

Russia’s revenues from oil exports fell by almost a third in the first quarter of this year, confirming that Western price ceilings are beginning to have an impact on Moscow’s trade, according to oil sales data compiled by the Kyiv School of Economics.

Reduces profits

Russia’s revenue from crude oil and refined products reached $38.8 billion in the first full quarter after the G7 and EU imposed price caps in December. In the last three months of 2022, these revenues reached 54.5 billion US dollars, writes “The Financial Times”. An estimated 75 percent of the drop is due to lower sales and higher price discounts for Russian crude. The remaining 25% of the decline was due to lower world prices.

“Delfi Bizness” already reported that last year the Western powers agreed and in December a power limitation came into effect, which determined the amount for which Russian oil can be purchased. The price was set at $60 per barrel of crude oil. This year, however, the EU, G7 and Australia agreed to limit the prices of Russian products made from oil as well.

Russia announced voluntary production cuts in February in response to what Russian Deputy Prime Minister Alexander Novak called the “destructive energy policy of the collective West.”

“With the EU embargo fully in place, it has become very difficult for Russia to divert all offshore crude from the defunct European market,” said Bejamin Hilgenstock, senior economist at the Kyiv Institute.