UBS estimates Russian crude exports sit only about 10% below pre-war levels. The EU's share of those exports has fallen from 48% to 4%, while China, India and Turkey now take 77%. The most visible effect of the restrictions seems to have been to redistribute global oil supply, according to UBS.
UBS chief economist Arend Kapteyn says Russian crude exports remain only around 10% below pre-war levels, despite the EU embargo and the G7 price cap regime. His note, titled Who Is Buying Russia's Oil?, tracks where the barrels go. Kapteyn writes that the most visible effect of the restrictions seems to have been to redistribute global oil supply.
Buyers shift from Europe to Asia
The biggest change is in destinations. The EU's share of Russian crude oil exports collapsed from 48% before the war to 4% by September. Over the same period, the combined share bought by China, India and Turkey jumped from 29% to 77%.
Within those markets, Kapteyn points to specific gains. In China, Russia's share of mineral fuel imports rose from about 18% to 27% since February 2022. In India, Russia's share jumped from just over 1% to 24%.
Shadow fleet limits sanctions
UBS estimates that 61% of Russian crude now leaves on the so-called shadow fleet. Kapteyn notes that this fleet operates outside Western financing and insurance systems, which reduces the effectiveness of the sanctions and price-cap regime. He adds that the sanctions are jurisdictional rather than global, so they do not apply to countries that have not imposed them.
Refined products tell a different story. Russia has begun importing significant volumes of refined petroleum products, which Kapteyn links to the damage Ukrainian strikes have inflicted on domestic refining capacity. He calls that highly unusual for one of the world's largest exporters of diesel, fuel oil and naphtha, and says it is one factor helping keep global gasoline prices elevated.
Because Russia itself stopped publishing data in 2022, the UBS figures are estimates that correspond roughly to the import data of trade partners.
Source: Oilprice.com
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