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No Russia made new agreements with China, India, etc. and their oil and gas is being "laundered" through sales to those countries and back out to the west. The

No Russia made new agreements with China, India, etc. and their oil and gas is being "laundered" through sales to those countries and back out to the west. The sanctions have failed to do anything.

andreygrehov 3y ago
Not only failed, but backfired. All these Russia/China/India deals is the result of the sanctions. Heck, even Japan is now ignoring the price thresholds and buys from Russia.
- qbasic_forever 3y ago
  Yup, and no one is paying for oil in dollars anymore. The global value of the dollar is going to be destroyed over time. It's really breathtaking how quickly the west has decided to shoot itself in the foot with nothing to show for it.
  - boc 3y ago
    Cite your sources for the claim that “no one is paying for oil in dollars anymore” The West has stood up to a blatant land-grab invasion and has armed Ukrainians with the means to defend themselves effectively. Decimating the Russian military without firing a shot is objectively a NATO victory, regardless of the ultimate outcome.
    - ren_engineer 3y ago
      the ham-fisted SWIFT ban was the real mistake and that is what's driving countries away from the dollar more than anything. Removing Russia from SWIFT was the financial equivalent of launching nukes and will be seen as a major mistake long term China's competitor to SWIFT has doubled in transaction volume since the sanctions and is growing fast - https://www.ft.com/content/6d5bbdbc-9f5d-41b2-ba80-7d8ac3973cf3 https://www.ft.com/content/6d5bbdbc-9f5d-41b2-ba80-7d8ac3973...
      - boc 3y ago
        Russia’s economy is smaller and less diverse than the state of New York. People treat Russia as a near-peer when they are in reality a backwater gas station strapped to a cold-war era nuclear triad. The fact that their military can’t defeat ukraine is absolutely baffling, but indicative of how rotten that country has become. Cutting them off from SWIFT isn’t a nuke in the new financial Cold War. It’s the consequence of the path Russia chose when they started this incredibly stupid invasion. Framing western reactions to Russian stupidity as “the real mistake” shows that you aren’t paying enough attention. The US threw down the gauntlet against an unimportant Russian invasion to ensure China gets the message that the United States is ready for economic warfare over Taiwan. If that action decreases the likelihood of invasion by just 10-20%, it’s certainly worthwhile.
      - simonh 3y ago
        The Yuan has lost 7% of it's value against the Dollar in the last 3 months. The fact is the Dollar is incredibly strong, it's up over 6% on a year ago. Yes trade in marginal currencies like the Yuan is up because Russia is desperate, they will trade in anything right now, but this is all small change. It's easy to double transactions when they start from such a pitifully small level to start with. Demand for dollars is as high today as ever.
        ren_engineer 3y ago
        China regularly devalues the Yuan because they want it weaker to boost exports
    - andreygrehov 3y ago
      https://www.wsj.com/articles/russia-turns-to-chinas-yuan-in-effort-to-ditch-the-dollar-a8111457 https://www.wsj.com/articles/russia-turns-to-chinas-yuan-in-...
      - kasey_junk 3y ago
        Russia _has_ to use the yuan but that’s a far cry from “everyone”. China just paid for their first boat of yuan settled LG on the open market 20 days ago. After 6 years of offering it on their exchange. Their meeting with the Saudi’s last month came with non-committal statements, again, 6 years after they first started. I think the yuan becoming more involved in the energy trade is inevitable, they are the largest energy importer in the world and a major economy. It may have even been accelerated by the sanctions on Iran and Russia. But to say that “no one is paying for oil in dollars anymore” is a ludicrous statement (probably one that comes from the posters hopes not the facts). And adding the petroyuan to the mix is more dangerous to the Chinese currency than to the dollar. It immediately becomes imminently arbitrage-able in ways it can’t be currently due to currency controls. The Chinese government has been de-liberalizing their currency because they are worried what the markets will do to it. That’s not to mention their treasury exposure, trade surpluses and the Middle Eastern states currency pegs. A de-dollarization of the energy market will make it less efficient and may cause some rebalancing of currency reserves, but it will drive all settlement currencies to free market parity which is good for western currencies and bad for Chinese and Russian ones.
        andreygrehov 3y ago
        I agree that "no one is paying for oil in dollars anymore" is an overblown statement. However, the de-dollarization process was started in 2014 and will keep getting stronger. This matches the recent leaks (as well as the video confirmation by François Hollande - the former President of France), that the 2014 coup in Ukraine was staged and sponsored by the US. As a Ukrainian, I tend to believe that a good portion of the conflict between Russia and Ukraine is driven by the de-dollarization fears of the US. The global superpower country is basically losing its main leverage, which is, in my personal opinion, a huge deal. While the mainstream media keeps it all super positive, I think the US did a lot of miscalculations within the past several years. And honestly, something tells me that Putin will outplay them all. The guy is extremely smart and it's foolish to downplay him and say he is not. We shall see.
  - simonh 3y ago
    It's getting hard to keep taking what you're posting here seriously. It's so wildly over the horizon from reality, it's hard to see the point of replying. There is zero threat to the dollar. Demand for dollars is higher than ever, and it's still the primary currency for the oil trade, and pretty much any international trade. The recent economic instability has, as always happens, lead investors to flee to stability. That's the dollar, which is why it's up 6.6% over the last year. What we have to show for the last year is utterly humiliating the Russian military, successfully helping Ukraine repel an assault on their capital, and push back the Russian army twice since in significant territorial losses. The west has never been more united, NATO is stronger than ever. The AUKUS pact and US-European alignment on Taiwan has solidified, despite typical French squirming, but they'll come around. They always do. It's not like the economic picture is all roses, far from it, but that was happening already. The main achievement is that the fantasies Putin had of rolling back NATO are dead in a ditch, and I think the chances of a Chinese attack on Taiwan in the coming decade are half or less what they were a year ago.
kasey_junk 3y ago
It was big news this month when Russian oil exports finally made it back to prewar levels. Their revenue is still off by ~45% from prewar. The sanctions absolutely did something. Though I think it’s reasonable to ask if they caused a net increase in the cost of oil after the initial shock given how big a discount Russian oil buyers are getting. Though even if exports stabilized it’s possible the market is paying a risk premium.
- somenameforme 3y ago
  The point of the sanctions was to impact Russia's economy. Remember whole 'ruble is rubble' thing? The IMF expects Russia's economy to see net growth this year [1] after seeing a total decline of -2.1% last year. Their inflation rate is currently 7%, expected to hit 4.6% by the end of the year. As for oil prices, it's important to remember that oil prices before the war were very high, and they got even higher in the early parts of it. In February 21, 2022 (the invasion was on the 24th) prices were at $90/barrel. They hadn't been that high since 2014. [2] So it's easy to be somewhat misled just considering before/after scenarios. [1] - https://www.imf.org/en/Countries/RUS https://www.imf.org/en/Countries/RUS [2] - https://tradingeconomics.com/commodity/crude-oil https://tradingeconomics.com/commodity/crude-oil
  - kasey_junk 3y ago
    I think it’s entirely fair to suggest the sanctions did not achieve their desired goals. I think it’s an entirely different thing to suggest it did “nothing”. Oil revenues are off 45%. Its GDP was down 2% in 2022 while the thing it exports was up. Saudi Arabia’s and the UAE GDP set a record over the same time period as a point of reference. The OECD and World Bank anticipate GDP shrinkage this year as well. The ruble is at its lowest point in 20 years (if you remove the war shock). Thats even with the heroic activity of their central bank last year and current capital flight restrictions. Their sovereign wealth fund holds 16% less today than it did before the sanctions, because its being used to backstop the currency.
  - 0xDEF 3y ago
    The IMF is using the countries' own claims and numbers for their calculations. Russia's own economic numbers have been unreliable since Covid hit and blatantly cooked up since the February 2022 invasion of Ukraine. This paper gives a more correct view on the dire state of the Russian economy: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4167193 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4167193
s1artibartfast 3y ago
While partially true, you would still expect cost increases from oil flowing through China and India. I believe Russia is also a major fertilizer exporter and nitrogen fertilizers have more or less doubled in price
- hollerith 3y ago
  Nitrogen fertilizer is made from natural gas, so maybe the nitrogen fertilizer plants in the EU were shut down to ensure adequate supplies for the EU's more inelastic demands for natural gas. (More precisely, the natural gas is a cheap source of hydrogen atoms that get combined with nitrogen in the air to produce the fertilizer.) Maybe Russia realized that it would be profitable to use some of the natural gas it could no longer sell to Europe to make nitrogen fertilizer, but it takes many months to build the capacity to produce and export it, and in the meantime of course the price remains high.
  - deleted 3y ago
    [deleted]
fauxpause_ 3y ago
This is extremely wrong. The pipes are not flowing. There is oil being transferred via ships, but this is a much smaller volume and is much more expensive. It is not possible to sell the same amount without the pipelines to Europe. Russian exports and revenues have fallen drastically.
- qbasic_forever 3y ago
  You are not up to date on the reality of the situation, Russian oil exports are back to prewar levels: https://www.cnn.com/2023/04/14/energy/russia-oil-exports-iea-report/index.html https://www.cnn.com/2023/04/14/energy/russia-oil-exports-iea... They sell oil to a lot more places than Europe!
  - AlecSchueler 3y ago
    But what about the price of gas and oil on Europe, isn't that the salient point?
    - qbasic_forever 3y ago
      The goal of sanctions wasn't to raise the price of oil, it was to crush the Russian economy which the west assumed depended on Russia exporting oil and gas directly to Europe. That goal appears to have failed as Russia just made new agreements to sell oil/gas to other countries (who then sell to Europe).
      - distances 3y ago
        On the contrary, that goal has worked pretty well. Russia has to sell crude now, plus at very low price points. It's a shame that China and especially India continue to buy, but at least they're taking advantage of the situation to pay a pittance so Russia isn't making profits with it. Russia's economy isn't crushed but it has now a massive budget deficit that isn't sustainable without some extreme adaptations.
      - fauxpause_ 3y ago
f6v 3y ago
The sanctions didn’t fail. They probably complicated the oil transport logistics a lot. There’s been stories of how uninsured Russian tankers offload oil bear Gibraltar. Then the oil goes somewhere in China(or India). I suppose it’s going to find its way back to Europe as “Indian diesel”. So, exactly as you describe. But all of this should add costs even if the crude oil prices are at the proposed ceiling. Who lost? Russia and the EU. But who said that wasn’t the plan.
- qbasic_forever 3y ago
  It's been a year, where is this collapse of the Russian economy? It looks like they're doing just fine and can continue to wage war near indefinitely. What are the sanctions even doing at this point??
  - f6v 3y ago
    The sanctions were supposed to sever the ties between Russia and the EU. That worked perfectly. Same as the refugee crisis. The two most active supporters of Ukraine(USA and UK) take almost no refugees from Ukraine. It’s the EU that suffers from having to support them.
    - qbasic_forever 3y ago
      What? The US has taken an enormous amount of Ukraine refugees: https://www.nbcnews.com/politics/immigration/us-admits-271000-ukrainian-refugees-russia-invasion-biden-rcna72177 https://www.nbcnews.com/politics/immigration/us-admits-27100... 271,000! That's over double their goal of 100k! They explicitly got rid of refugee restrictions put in place at the start of the pandemic so they could let in Ukraine refugees.
      - f6v 3y ago
        Bulgaria, Romania, Slovakia combined took twice more than that. 271k is nothing for US given their role in the conflict.
simonh 3y ago
Cutting off Russian oil completely was never the plan, it would have lead to an extremely damaging spike in oil prices that would have hurt everybody. Rather, the objective was to keep Russian oil flowing, while dramatically reducing the extent to which Russia profits from it. This has worked, the prices Russia is getting for their oil are single digit dollars above their production costs, which are going up due to sanctions, while global oil prices remained fairly stable. India and such buying cheap Russian oil is an intended outcome, not a problem. Good for them. It also helps that India is processing this oil into value-add exports that are pricing out Russian alternatives.
- qbasic_forever 3y ago
  [flagged]
  - simonh 3y ago
    Here's an actual quote: “The price cap is specifically designed to reduce Russian revenues and Russia’s ability to fund its war of aggression whilst limiting the impact of Russia ́s war on global energy prices, particularly for low and middle-income countries,” - Joint statement by G7 finance ministers. A lot of breathless headlines got published early on by non-specialist journalists that have never had to cover anything like this, but nobody who actually understands the history and practice of sanctions in the modern era believed they would actually bring Russia to their knees any time soon. Read any of the coverage of these sanctions in The Economist from last year. North Korea has been under far more severe sanctions for generations and has even managed to develop nuclear weapons. Iran came under similarly severe sanctions and they're still a credible regional threat. The idea that Russia, a nuclear state with massive foreign reserves to draw on, even aside from the ones frozen in the west, would be beggared in a matter of months was always absurd. Sanctions have never in the modern era actually forced a state to capitulate. Wiping out on the order of 85% of Russia's oil profits while maintaining global prices is a major success. Yes Russian oil is still flowing, but the profits are now disproportionately going to countries outside Russia, like India. They're not suffering from the sanctions, they're making a killing Good for them. Even if you don't believe that this was the stated goal, though as you can see from the quote I opened with it was the actual stated goal, it's still obviously what's actually happened.

No Russia made new agreements with China, India, etc. and their oil and gas is being "laundered" through sales to those countries and back out to the west. The sanctions have failed to do anything.

andreygrehov 3y ago

Not only failed, but backfired. All these Russia/China/India deals is the result of the sanctions. Heck, even Japan is now ignoring the price thresholds and buys from Russia.

qbasic_forever 3y ago
Yup, and no one is paying for oil in dollars anymore. The global value of the dollar is going to be destroyed over time. It's really breathtaking how quickly the west has decided to shoot itself in the foot with nothing to show for it.
- boc 3y ago
  Cite your sources for the claim that “no one is paying for oil in dollars anymore” The West has stood up to a blatant land-grab invasion and has armed Ukrainians with the means to defend themselves effectively. Decimating the Russian military without firing a shot is objectively a NATO victory, regardless of the ultimate outcome.
  - ren_engineer 3y ago
    the ham-fisted SWIFT ban was the real mistake and that is what's driving countries away from the dollar more than anything. Removing Russia from SWIFT was the financial equivalent of launching nukes and will be seen as a major mistake long term China's competitor to SWIFT has doubled in transaction volume since the sanctions and is growing fast - https://www.ft.com/content/6d5bbdbc-9f5d-41b2-ba80-7d8ac3973cf3 https://www.ft.com/content/6d5bbdbc-9f5d-41b2-ba80-7d8ac3973...
    - boc 3y ago
      Russia’s economy is smaller and less diverse than the state of New York. People treat Russia as a near-peer when they are in reality a backwater gas station strapped to a cold-war era nuclear triad. The fact that their military can’t defeat ukraine is absolutely baffling, but indicative of how rotten that country has become. Cutting them off from SWIFT isn’t a nuke in the new financial Cold War. It’s the consequence of the path Russia chose when they started this incredibly stupid invasion. Framing western reactions to Russian stupidity as “the real mistake” shows that you aren’t paying enough attention. The US threw down the gauntlet against an unimportant Russian invasion to ensure China gets the message that the United States is ready for economic warfare over Taiwan. If that action decreases the likelihood of invasion by just 10-20%, it’s certainly worthwhile.
    - simonh 3y ago
      The Yuan has lost 7% of it's value against the Dollar in the last 3 months. The fact is the Dollar is incredibly strong, it's up over 6% on a year ago. Yes trade in marginal currencies like the Yuan is up because Russia is desperate, they will trade in anything right now, but this is all small change. It's easy to double transactions when they start from such a pitifully small level to start with. Demand for dollars is as high today as ever.
      - ren_engineer 3y ago
        China regularly devalues the Yuan because they want it weaker to boost exports
  - andreygrehov 3y ago
    https://www.wsj.com/articles/russia-turns-to-chinas-yuan-in-effort-to-ditch-the-dollar-a8111457 https://www.wsj.com/articles/russia-turns-to-chinas-yuan-in-...
    - kasey_junk 3y ago
      Russia _has_ to use the yuan but that’s a far cry from “everyone”. China just paid for their first boat of yuan settled LG on the open market 20 days ago. After 6 years of offering it on their exchange. Their meeting with the Saudi’s last month came with non-committal statements, again, 6 years after they first started. I think the yuan becoming more involved in the energy trade is inevitable, they are the largest energy importer in the world and a major economy. It may have even been accelerated by the sanctions on Iran and Russia. But to say that “no one is paying for oil in dollars anymore” is a ludicrous statement (probably one that comes from the posters hopes not the facts). And adding the petroyuan to the mix is more dangerous to the Chinese currency than to the dollar. It immediately becomes imminently arbitrage-able in ways it can’t be currently due to currency controls. The Chinese government has been de-liberalizing their currency because they are worried what the markets will do to it. That’s not to mention their treasury exposure, trade surpluses and the Middle Eastern states currency pegs. A de-dollarization of the energy market will make it less efficient and may cause some rebalancing of currency reserves, but it will drive all settlement currencies to free market parity which is good for western currencies and bad for Chinese and Russian ones.
      - andreygrehov 3y ago
        I agree that "no one is paying for oil in dollars anymore" is an overblown statement. However, the de-dollarization process was started in 2014 and will keep getting stronger. This matches the recent leaks (as well as the video confirmation by François Hollande - the former President of France), that the 2014 coup in Ukraine was staged and sponsored by the US. As a Ukrainian, I tend to believe that a good portion of the conflict between Russia and Ukraine is driven by the de-dollarization fears of the US. The global superpower country is basically losing its main leverage, which is, in my personal opinion, a huge deal. While the mainstream media keeps it all super positive, I think the US did a lot of miscalculations within the past several years. And honestly, something tells me that Putin will outplay them all. The guy is extremely smart and it's foolish to downplay him and say he is not. We shall see.
- simonh 3y ago
  It's getting hard to keep taking what you're posting here seriously. It's so wildly over the horizon from reality, it's hard to see the point of replying. There is zero threat to the dollar. Demand for dollars is higher than ever, and it's still the primary currency for the oil trade, and pretty much any international trade. The recent economic instability has, as always happens, lead investors to flee to stability. That's the dollar, which is why it's up 6.6% over the last year. What we have to show for the last year is utterly humiliating the Russian military, successfully helping Ukraine repel an assault on their capital, and push back the Russian army twice since in significant territorial losses. The west has never been more united, NATO is stronger than ever. The AUKUS pact and US-European alignment on Taiwan has solidified, despite typical French squirming, but they'll come around. They always do. It's not like the economic picture is all roses, far from it, but that was happening already. The main achievement is that the fantasies Putin had of rolling back NATO are dead in a ditch, and I think the chances of a Chinese attack on Taiwan in the coming decade are half or less what they were a year ago.

kasey_junk 3y ago

It was big news this month when Russian oil exports finally made it back to prewar levels. Their revenue is still off by ~45% from prewar. The sanctions absolutely did something. Though I think it’s reasonable to ask if they caused a net increase in the cost of oil after the initial shock given how big a discount Russian oil buyers are getting. Though even if exports stabilized it’s possible the market is paying a risk premium.

somenameforme 3y ago
The point of the sanctions was to impact Russia's economy. Remember whole 'ruble is rubble' thing? The IMF expects Russia's economy to see net growth this year [1] after seeing a total decline of -2.1% last year. Their inflation rate is currently 7%, expected to hit 4.6% by the end of the year. As for oil prices, it's important to remember that oil prices before the war were very high, and they got even higher in the early parts of it. In February 21, 2022 (the invasion was on the 24th) prices were at $90/barrel. They hadn't been that high since 2014. [2] So it's easy to be somewhat misled just considering before/after scenarios. [1] - https://www.imf.org/en/Countries/RUS https://www.imf.org/en/Countries/RUS [2] - https://tradingeconomics.com/commodity/crude-oil https://tradingeconomics.com/commodity/crude-oil
- kasey_junk 3y ago
  I think it’s entirely fair to suggest the sanctions did not achieve their desired goals. I think it’s an entirely different thing to suggest it did “nothing”. Oil revenues are off 45%. Its GDP was down 2% in 2022 while the thing it exports was up. Saudi Arabia’s and the UAE GDP set a record over the same time period as a point of reference. The OECD and World Bank anticipate GDP shrinkage this year as well. The ruble is at its lowest point in 20 years (if you remove the war shock). Thats even with the heroic activity of their central bank last year and current capital flight restrictions. Their sovereign wealth fund holds 16% less today than it did before the sanctions, because its being used to backstop the currency.
- 0xDEF 3y ago
  The IMF is using the countries' own claims and numbers for their calculations. Russia's own economic numbers have been unreliable since Covid hit and blatantly cooked up since the February 2022 invasion of Ukraine. This paper gives a more correct view on the dire state of the Russian economy: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4167193 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4167193

s1artibartfast 3y ago

While partially true, you would still expect cost increases from oil flowing through China and India. I believe Russia is also a major fertilizer exporter and nitrogen fertilizers have more or less doubled in price

hollerith 3y ago
Nitrogen fertilizer is made from natural gas, so maybe the nitrogen fertilizer plants in the EU were shut down to ensure adequate supplies for the EU's more inelastic demands for natural gas. (More precisely, the natural gas is a cheap source of hydrogen atoms that get combined with nitrogen in the air to produce the fertilizer.) Maybe Russia realized that it would be profitable to use some of the natural gas it could no longer sell to Europe to make nitrogen fertilizer, but it takes many months to build the capacity to produce and export it, and in the meantime of course the price remains high.
- deleted 3y ago
  [deleted]

fauxpause_ 3y ago

This is extremely wrong. The pipes are not flowing. There is oil being transferred via ships, but this is a much smaller volume and is much more expensive. It is not possible to sell the same amount without the pipelines to Europe. Russian exports and revenues have fallen drastically.

qbasic_forever 3y ago
You are not up to date on the reality of the situation, Russian oil exports are back to prewar levels: https://www.cnn.com/2023/04/14/energy/russia-oil-exports-iea-report/index.html https://www.cnn.com/2023/04/14/energy/russia-oil-exports-iea... They sell oil to a lot more places than Europe!
- AlecSchueler 3y ago
  But what about the price of gas and oil on Europe, isn't that the salient point?
  - qbasic_forever 3y ago
    The goal of sanctions wasn't to raise the price of oil, it was to crush the Russian economy which the west assumed depended on Russia exporting oil and gas directly to Europe. That goal appears to have failed as Russia just made new agreements to sell oil/gas to other countries (who then sell to Europe).
    - distances 3y ago
      On the contrary, that goal has worked pretty well. Russia has to sell crude now, plus at very low price points. It's a shame that China and especially India continue to buy, but at least they're taking advantage of the situation to pay a pittance so Russia isn't making profits with it. Russia's economy isn't crushed but it has now a massive budget deficit that isn't sustainable without some extreme adaptations.
    - fauxpause_ 3y ago

f6v 3y ago

The sanctions didn’t fail. They probably complicated the oil transport logistics a lot. There’s been stories of how uninsured Russian tankers offload oil bear Gibraltar. Then the oil goes somewhere in China(or India). I suppose it’s going to find its way back to Europe as “Indian diesel”. So, exactly as you describe. But all of this should add costs even if the crude oil prices are at the proposed ceiling. Who lost? Russia and the EU. But who said that wasn’t the plan.

qbasic_forever 3y ago
It's been a year, where is this collapse of the Russian economy? It looks like they're doing just fine and can continue to wage war near indefinitely. What are the sanctions even doing at this point??
- f6v 3y ago
  The sanctions were supposed to sever the ties between Russia and the EU. That worked perfectly. Same as the refugee crisis. The two most active supporters of Ukraine(USA and UK) take almost no refugees from Ukraine. It’s the EU that suffers from having to support them.
  - qbasic_forever 3y ago
    What? The US has taken an enormous amount of Ukraine refugees: https://www.nbcnews.com/politics/immigration/us-admits-271000-ukrainian-refugees-russia-invasion-biden-rcna72177 https://www.nbcnews.com/politics/immigration/us-admits-27100... 271,000! That's over double their goal of 100k! They explicitly got rid of refugee restrictions put in place at the start of the pandemic so they could let in Ukraine refugees.
    - f6v 3y ago
      Bulgaria, Romania, Slovakia combined took twice more than that. 271k is nothing for US given their role in the conflict.

simonh 3y ago

Cutting off Russian oil completely was never the plan, it would have lead to an extremely damaging spike in oil prices that would have hurt everybody. Rather, the objective was to keep Russian oil flowing, while dramatically reducing the extent to which Russia profits from it. This has worked, the prices Russia is getting for their oil are single digit dollars above their production costs, which are going up due to sanctions, while global oil prices remained fairly stable. India and such buying cheap Russian oil is an intended outcome, not a problem. Good for them. It also helps that India is processing this oil into value-add exports that are pricing out Russian alternatives.

qbasic_forever 3y ago
[flagged]
- simonh 3y ago
  Here's an actual quote: “The price cap is specifically designed to reduce Russian revenues and Russia’s ability to fund its war of aggression whilst limiting the impact of Russia ́s war on global energy prices, particularly for low and middle-income countries,” - Joint statement by G7 finance ministers. A lot of breathless headlines got published early on by non-specialist journalists that have never had to cover anything like this, but nobody who actually understands the history and practice of sanctions in the modern era believed they would actually bring Russia to their knees any time soon. Read any of the coverage of these sanctions in The Economist from last year. North Korea has been under far more severe sanctions for generations and has even managed to develop nuclear weapons. Iran came under similarly severe sanctions and they're still a credible regional threat. The idea that Russia, a nuclear state with massive foreign reserves to draw on, even aside from the ones frozen in the west, would be beggared in a matter of months was always absurd. Sanctions have never in the modern era actually forced a state to capitulate. Wiping out on the order of 85% of Russia's oil profits while maintaining global prices is a major success. Yes Russian oil is still flowing, but the profits are now disproportionately going to countries outside Russia, like India. They're not suffering from the sanctions, they're making a killing Good for them. Even if you don't believe that this was the stated goal, though as you can see from the quote I opened with it was the actual stated goal, it's still obviously what's actually happened.