According to BIMCO’s latest “Shipping Number of the Week,” as highlighted by Chief Shipping Analyst Niels Rasmussen, Russian oil exports during the first quarter of 2025 have decreased year-on-year but have remained largely unaffected by recent fresh rounds of sanctions, reports Safety4sea.
Impact Of Sanctions
According to Rasmussen, despite recent sanctions, Russian oil exports have not been significantly impacted. While Russian oil exports experienced a 6% year-on-year decrease in the first quarter of 2025, this decline doesn’t appear to be primarily driven by the recent sanctions. Specifically, clean tanker exports fell by 13%, and dirty tanker exports saw a 4% decrease compared to the first quarter of 2024.
Despite the Biden administration’s efforts to increase pressure on Russian oil exports in early January by sanctioning over 180 vessels and numerous individuals and companies involved in the sector, the seaborne oil trade has remained largely unaffected. This resilience is further evidenced by the trade seemingly withstanding the Shandong Port Group’s ban on US-sanctioned ships and India’s indication to only purchase oil from non-US-sanctioned entities.
Rasmussen suggests that while the immediate impact of sanctions on export volumes has been limited, future market dynamics could pose challenges. Factors such as increased OPEC production potentially leading buyers to seek alternative suppliers and a decrease in demand due to slower economic growth from trade wars and decarbonization efforts might influence Russian oil exports moving forward.
It’s worth noting that 72 new ships, which have not participated in the trade since the G7 oil price cap agreement in December 2022 and are mostly not sanctioned, have helped sustain year-to-date exports. Additionally, 162 sanctioned ships still exported Russian oil in the first quarter of 2025, accounting for approximately 20% of the total exports, with India and China importing 80% of this volume. The sanctions have, however, reduced ship availability, leading to increased freight rates. In some instances, according to the International Energy Agency, these higher freight rates have pushed oil prices below the G7 price cap, facilitating a shift towards non-sanctioned tankers.
Oil Price
According to the provided data, during the first quarter of 2025, 162 sanctioned ships were involved in the export of Russian oil, collectively moving nearly 20% of the total exports. Notably, India and China accounted for 80% of the cargo transported by these sanctioned vessels.
It is crucial to recognize that a significant portion of the global community does not acknowledge or adhere to the sanctions imposed by the US, EU, and UK, nor do they abide by the G7 price cap on Russian oil. Consequently, seaborne export volumes from Russia have largely remained intact.
However, the sanctions have had an indirect impact by reducing the availability of ships, which has led to an increase in freight rates. Interestingly, the International Energy Agency reports that these higher freight costs have, in some instances, pushed the price of Russian oil below the G7 price cap of USD 60 per barrel. This has, in turn, facilitated a shift towards the use of non-sanctioned tankers for transporting Russian oil.
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Source: Safety4sea
