Sanctions With Holes “Russian Oil Is Imported To The UK Via India”
It has been revealed that Russian oil, which was embargoed by the West to stop ‘Putin’s money line’, is being imported indirectly into the UK. In the case of petroleum products such as aviation fuel and diesel oil processed outside Russia’s borders, this is the result of the exploitation of a loophole in regulations that allow ‘laundering’ of the origin.
Although the West is aware of this problem, it is unable to address the complete ban on petroleum products made from Russian crude oil. If all of this is prevented, it could lead to a surge in global energy prices.
No Russian Oil Imports From Russian, But Products Flow To The UK
According to a research paper by the non-governmental organization Global Witness obtained by the BBC on the 5th (local time), about 5.2 million barrels of petroleum products refined from Russian crude oil were imported into the UK last year. Of these, 4.6 million barrels were aviation fuel, and it is calculated that this fuel was used in one in 20 British flights.
Another report by the Finnish Center for Energy and Clean Air Research (CREA) also estimated that about 569 million pounds (about 949.4 billion won) worth of petroleum products made from Russian crude oil were distributed in the UK in the year from December 2022, BBC reported. reported.
This is due to a loophole in the ‘rules of origin’. For example, petroleum products that have been processed in India, even Russian crude oil, are classified as having their origin in India. If it is made in India, the way to import it to the UK ‘legally’ opens. In this case, the BBC pointed out, “It is not only illegal, but it does not violate the embargo on Russian crude oil.” The British government’s official position is that “there has been no import of Russian oil since sanctions against Russia in 2022.”
Sanctions Fall Western ‘Dilemma’
Russia, the world’s third-largest oil producer, is heavily dependent on energy exports. This is why the West has started imposing sanctions, such as imposing a cap to prevent Russian crude oil from trading above $60 per barrel after Russia’s invasion of Ukraine in 2022. However, loopholes in rules of origin weaken the effectiveness of these high-intensity sanctions against Russia. The International Monetary Fund (IMF) raised its forecast for Russia’s gross domestic product (GDP) growth rate this year to 2.6%, double last year’s forecast (1.1%). This is proof that Western economic sanctions are not working.
Isaac Levy, head of Europe and Russia at CREA, told the BBC, ” The loopholes in the rules of origin will increase the demand for Russian crude oil, leading to increased sales and higher prices. This could also increase the flow of war funds to the Kremlin (Russian presidential palace). ” said.
CREA and Global Witness estimated that Russia’s indirect profits from selling petroleum products refined from domestic crude oil to the UK are over 100 million pounds (about 166.7 billion won). Most of this is through petroleum products refined in India and China, which are exempt from Russian sanctions.
For this reason, Ukraine is urging the West to impose a complete embargo on petroleum products made from Russian crude oil. But the situation is not simple. “It is impossible to drive Russian crude oil or petroleum products made from Russian raw materials out of the global energy market,” said Matt Smith, an analyst at Kpler, a logistics information company. “This could lead to a surge in energy prices (due to a shortage of petroleum products).” “He pointed out.
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