The Russian Federation continues to lose its role as a key supplier of hydrocarbons in the global market due to increasing sanctions and the energy reorientation of leading economies. One of the main areas of pressure has been the US decision regarding India, which is currently the largest buyer of Russian oil supplied by sea at a discount following the imposition of Western sanctions due to Russia’s war against Ukraine.
This is reported by Finway
US Pressure on India and New Rules for Europe
US President Donald Trump emphasized that India will pay “huge” tariffs on its exports to the US until it stops purchasing oil from Russia.
India will continue to pay “huge” tariffs on its exports to the US until it stops buying Russian oil, said US President Donald Trump.
Against this backdrop, European Union countries are actively implementing a strategy for a gradual phase-out of imports of Russian energy resources. EU energy ministers have agreed on new rules that foresee a complete halt to the purchase of Russian oil and gas by January 2028. These restrictions will be implemented in stages, and a complete ban on the import of Russian liquefied natural gas (LNG) is planned in the near future. To ensure energy security, Europe is expanding cooperation with the US, signing energy agreements totaling $750 billion. Currently, about 15% of the LNG arriving in Europe is of Russian origin, and monthly expenditures on Russian gas range from €500 to €700 million.
Searching for Alternatives and Energy Partnerships
Ukrainian President Volodymyr Zelensky noted that the United States is ready to provide Europe with sufficient oil and gas to fully replace Russian supplies. Ukraine, in turn, has unique infrastructure capabilities and potential to contribute to Europe’s energy independence, and American energy companies have already shown interest in entering the Ukrainian market.
At the same time, Russia’s client countries are ramping up their own energy resource extraction. Iraq has signed an agreement with Exxon Mobil to develop the Majnoon field, which is estimated to hold 38 billion barrels of oil. Today, Iraq produces about 4 million barrels of oil per day and plans to increase this figure to over 6 million barrels by 2029.
Iran, which recently became a new gas partner of Russia, announced the discovery of significant gas and oil reserves at the Pazan field: 280 billion cubic meters of gas and 200 million barrels of oil. Production is planned to start within the next 40 months, and the economic value of the gas reserves is estimated at over $100 billion. Last summer, Gazprom and the National Iranian Gas Company signed a memorandum for the supply of Russian pipeline gas, indicating a gradual shift in energy alliances in the global market.