Russia is still passing $2 billion worth of its oil products to the West via middlemen, think tank says

• The West is still taking in billions worth of Russian oil products, a new think tank analysis shows.
• Russia sold $1.3B of oil to Turkey in the first half of the year before it made its way to the West.

Russia is still passing off billions of dollars worth of oil products to the West — a sign that the West is still struggling to throttle Moscow's war revenue with strict sanctions.

Russia is still exporting its crude to Turkey, where refineries process the oil and later export crude products to the West, according to a new analysis from the Centre for Research on Energy and Clean Air.

CREA data shows that Russia sold $1.3 billion worth of oil to three Turkish refineries in the first half of the year. G7+ nations, meanwhile, purchased around $2 billion of oil products of Russian origin from Turkish refiners, the think tank estimated.

Western countries have ramped up their purchases from those three Turkish refineries since Russia began its invasion of Ukraine, the researchers added. The US, for instance, increased imports from those refineries by 335% on a yearly basis in the first half of 2024.

"G7+ countries have displayed little desire or political will to address the refining loophole and stop it since the beginning of Russia's full-scale invasion of Ukraine. While the loophole goes unchecked, G7+ countries have actually increased their imports from non-sanctioning countries, taking advantage of the situation by simply switching their supplier from Russia to third countries that are essentially functioning as Russian middlemen merchants," the researchers said.

It's not the first time Russia used its trading partners to pass off energy products to the West. Indian refiners, for instance, funneled around 89,000 barrels of gasoline and diesel a day to New York, a 2023 Kpler analysis found.

Asian buyers of Russian oil, though, have pulled back in recent months, with Russia's crude shipments to the continent dropping around 10% since the spring, according to Argus Media data cited by Bloomberg. Turkey is the last-remaining "short-haul market" for Russian oil sent from its western ports, taking in around 210,000 barrels of Russian crude a day the last month, the outlet reported.

Still, Western sanctions have worked to crimp Moscow's war revenue. Trade restrictions, which include a $60 price cap and ban on Russian oil, dented Russia's crude profits by 14% in 2023, a previous CREA analysis found, which has also been aided by Russia's voluntary oil production cuts and falling crude prices.

Russia's crude sales dropped to $1.4 billion at the start of September, the lowest level recorded since January, Bloomberg reported.