Russia oil revenues surge as Iran conflict lifts prices

ISTANBUL

Russia is earning about $760 million a day from oil exports as the war in Iran drives up global crude prices and boosts demand for Russian barrels, The Telegraph reported Thursday, citing data from the Kyiv School of Economics (KSE) Institute.

The institute said Russia’s oil and gas sales are expected to nearly double this month, rising from about $12 billion to almost $24 billion, as Moscow benefits from higher prices and temporary US sanctions waivers.

Even if the conflict ends in the coming weeks, Russia’s annual oil and gas export revenues are projected to reach $218.5 billion this year, up 63% from a scenario in which Middle East energy supplies remain undisrupted, KSE said. That would amount to an additional $84 billion in windfall revenue.

If the conflict continues for another six months, annual revenues could climb to $386.5 billion, nearly 188% above pre-crisis estimates, according to the same projections.

At a Kremlin meeting on economic issues Monday, Russian President Vladimir Putin said oil and gas companies should use the additional revenue from higher hydrocarbon prices to reduce their debt to domestic banks.

“Russian oil and gas companies should consider using additional revenue from rising global hydrocarbon prices to reduce their debt burden and pay off their debt to domestic banks. This would be a mature decision,” Putin said.

The report said Russia has also benefited from temporary US sanctions waivers covering some oil cargoes already loaded onto tankers, easing transaction risks for buyers.

Analysts said Russian oil had previously been sold at a steep discount because sanctions raised legal, financial and logistical costs. But the waivers have allowed Moscow to market some crude at closer to open-market prices.

Global oil prices have surged since the conflict in Iran began, with Brent crude rising about 40% to around $105 per barrel. The price of Russian oil has increased even faster, according to KSE estimates.