The United States has become the largest supplier of crude oil to the European Union after 18 percent of crude oil imports came from America in December, Eurostat announced this week. This represents a major reversal since Russia was, until recently, the main oil exporter to the E.U.
According to Eurostat data, until the end of January last year, Russia was the largest oil supplier in the E.U., with 31 percent of total imports. At the same time, the U.S. was in second place with a maximum share of up to 13 percent, reports CNN.
The start of the war in Ukraine in February last year led to a reversal in the energy supply in Europe. E.U. countries reduced the import of Russian energy products, and Brussels introduced sanctions on importing oil and coal from Russia.
In December, the European Union banned the import of Russian oil by sea. It introduced a price ceiling, which prohibits shippers, insurance brokers, and other companies from providing their services in trade and transport if Russian oil costs more than 60 dollars per barrel.
Reduction of Russian gas imports
When the war began, some European countries also began to cut their imports of Russian natural gas, while Moscow cut back supplies simultaneously. Russia’s Gazprom supplied around 35 percent of total European gas imports in 2021, only to significantly reduce deliveries last year until the complete cessation of deliveries through the Nord Stream 1 gas pipeline in September after the pipeline was mined.
According to Eurostat data, Russia’s share of European natural gas imports fell from 31 percent in the first quarter to around 19 percent by the end of the year. This allowed the US to become the second largest gas supplier to the E.U. with about a 20 percent share, while Norway took first place with 31 percent.
According to Vortex, U.S. crude oil exports to Europe had been growing even before the war, but its onset increased demand for alternative supplies. Russian oil imports to the E.U. were volatile between February and April last year but have steadily declined since September to four percent in December.
By the end of last year, the E.U.’s largest suppliers of crude oil were the USA, Norway, and Kazakhstan, and according to Eurostat, this shows that the E.U. managed to adapt to the changing environment of the oil market and practically ended its dependence on oil imports from Russia.
During this time, Russia found new buyers for its oil, selling it at a significant discount. The price at which Russian Urals oil is currently sold is around $54 per barrel, which is about $25 less than the price of the benchmark Brent oil.
The main buyers of Russian oil are India and China, which have increased imports since the beginning of the war in Ukraine. Russian Energy Minister Nikolai Shulginov announced this week that Moscow has successfully redirected the “entire volume” of crude oil and petroleum product exports lost due to Western sanctions, TASS reports.
