Russia Rakes In Billions From Hormuz Blockade – German Trade Body

MOSCOW, April 7 (Bernama-dpa) -- Russia is generating billions in revenue from its commodity exports due to the effective closure of the Strait of Hormuz, said the German-Russian Foreign Trade Chamber on Tuesday, reported German Press Agency (dpa).

Russia’s profits from exporting oil, gas and fertiliser amount to more than €10 billion (US$11.54 billion) a month, the chamber said.

"Russia is the big winner of the new conflict in West Asia," Matthias Schepp, the chamber’s chairman, said.

Russia is benefiting from higher global commodity prices because it uses alternative export routes. All of this could "bring Russia an unexpected windfall on a historic scale," Schepp said in Moscow.

With a sustained oil price of around US$100 a barrel, Russia could expect an annual increase of US$71.8 billion compared with its budget plan.

The price of Brent crude for June delivery rose to more than US$111 per barrel – each holding 159 litres – at the start of the week. That is almost US$40 higher than before the war began.

The Russian budget is heavily dependent on oil and gas sales, with US$59 per barrel currently assumed in the budget. Before the Iran conflict, it showed a deficit because oil prices were below the planned level.

"At the current price level, Moscow can generate around US$50 billion in additional revenue per year from oil and gas alone," the chamber said.

Russia, which is also hoping for an end to Western sanctions, is using proceeds from commodity sales to finance its war against Ukraine.

Some in Moscow are already hoping for an oil price of US$200 per barrel. According to the chamber, that would generate US$350.4 billion – US$247 billion more than planned in the budget.

-- BERNAMA-dpa