russia has lost the EU oil market: what are the consequences for the Kremlin?
15 May 21:17
INFOGRAPHICS
The European Union has changed its energy geography bypassing Russia. Now the market has been restructured and will not return to its previous state, "Komersant Ukrainian" reports, citing the European Commission’s website.
In 2024, the European Union made a radical transformation of its energy policy, completely abandoning Russian oil imports. This was the result of sanctions aimed at reducing the financing of Russia’s military aggression against Ukraine, as well as part of a broader strategy to increase the energy independence of EU member states.
Russia’s loss of the European oil market
Until 2022, Russia was a key supplier of oil to the EU, accounting for about 27% of imports. This provided the Kremlin with annual revenues of tens of billions of euros. However, in December 2022, an embargo was imposed on maritime supplies, and in February 2023 – on petroleum products. In 2024, Russia’s share of the European oil market dropped to almost zero.
Bloomberg estimates that Russia lost more than $50 billion in revenue in the first two years of sanctions alone.
According to the CREA, in April 2025, Russia’s revenues from fossil fuel exports fell to 585 million euros per day, the lowest level since the beginning of the war. For comparison, in March 2022, this figure reached more than 1.2 billion euros per day.
New oil suppliers for the EU
The EU quickly rebuilt its import model. The largest volumes of oil supplies in 2024 came from:
- USA – 15% of total imports;
- Norway – 12%; and
- Kazakhstan – 12% of total imports
- Saudi Arabia, Iraq, Libya, Brazil, Nigeria, and the United Kingdom.
More than 50% of all imported oil comes by sea through the oil ports of the Netherlands, Italy, Spain, and France. These countries have significantly expanded their oil storage and refining infrastructure.
Implications for the Russian economy
The loss of profitable markets has forced Russia to sell oil at a discount of up to $20 per barrel. The main buyers – China and India – are using this situation to put pressure on prices, which significantly reduces foreign exchange earnings to the Russian budget. JPMorgan analysts predict that in 2025, the Russian budget deficit may exceed 3 trillion rubles, which increases the likelihood of sequestration of expenditures, including defense spending.
Restructuring the EU energy market
Against the backdrop of oil reorientation, the EU has accelerated investments in green energy. In 2024, EU spending on energy transformation exceeded €100 billion, including on wind and solar energy. Germany, France, and Italy have announced new national strategies to gradually reduce dependence on fossil fuels.
President of the European Commission Ursula von der Leyen emphasized that the war in Ukraine has brutally exposed the risks of blackmail, economic coercion and price shocks. Therefore, the European Union has diversified its energy supply and significantly reduced Europe’s previous dependence on Russian fuel.
The time has come for Europe to completely sever its energy ties with an unreliable supplier. And the energy that comes to our continent should not pay for the aggressive war against Ukraine.” This is our duty to our citizens, our companies and our brave Ukrainian friends,” said Ursula von der Leyen.
In his turn, Commissioner for Energy, Housing and Utilities Dan Jorgensen emphasized that the EU is demonstrating strength and determination by refusing Russian fuel and other energy resources.
The message to Russia is clear: “You will no longer blackmail our member states. The euro will no longer go to your war chest. Your gas will be banned. Your shadow fleet will be stopped”. We are doing this to preserve our security. But this is also an important step towards energy independence,” Jorgensen emphasized.
Thus, the EU’s complete rejection of Russian oil has not only weakened Moscow’s position in the global market, but also launched a process of long-term reforms in the European energy sector. This is an example of how a political decision can have a powerful economic and geopolitical effect.
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