Russia was 'a key product supplier to the European market before sanctions, especially of diesel, fuel oil, and naphtha,' said Rebeka Foley, senior analyst of near-term oil markets, at S&P Global. This left Moscow 'struggling to keep a foothold in the raw materials ladder, by seeking new markets for commodity exports,' Kulakhmetov said.Ī lower price cap of $45/b on petroleum products traded at a discount to crude oil came into force on the same date.Īlthough Russian refined product flows dipped slightly after the February 2022 invasion, they reached a seven-year high of 1.9 million b/d in March 2023.Īnd while shipments to European countries, like France and Belgium, have cratered in recent months, shipments to African countries-particularly northerly ones-have skyrocketed, particularly after the EU embargo on product imports came into force. A G7, EU, and Australia price cap of $100/b on Russian products that typically trade at a premium to crude including gasoline and gasoil was introduced at the same time. Perhaps the clearest evidence of strengthened ties is in Russian refined product exports since an EU embargo on imports of most Russian oil products came into force Feb. At the United Nations General Assembly in March, 22 African countries refused to condemn Vladimir Putin's full-scale invasion. Meanwhile, Russian mercenaries with the Wagner Group have provided security for African rulers in return for lucrative mining contracts, and Russian energy companies have eyed investments on the continent. Sergei Lavrov, Russia's foreign minister, visited seven African countries in the space of a month last year in a bid to firm up ties with key countries and open up new markets for Russian oil products, independent Russia analyst Timur Kulakhmetov told S&P Global Commodity Insights. India, China, and Turkey are also becoming increasingly important export markets.Įxperts say a new 'scramble for Africa' has gathered pace since the invasion began early last year, with Russia, China, the US, Turkey, Gulf states, and former colonial powers Britain and France all vying for influence on the world's fastest-growing continent. These sanctions have forced Russia to redirect significant oil export volumes to alternative markets, including Africa. The embargo followed independent decisions from many Western countries to halt imports of Russian oil. Illustrating the geopolitics at play, shipments to countries such as Nigeria, Tunisia, and Libya jumped sharply in February, when the European Union placed an embargo on Russian products. Prior to the war, Russia exported 33,000 b/d of refined products to Africa, much of it gasoline.īy March 2023, that had soared to 420,000 b/d. Receive daily email alerts, subscriber notes & personalize your experience.

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