Western sanctions that put a price cap on Russian oil exports from December 2022 aimed to cause the country significant economic pain after its invasi.
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Russian Oil Profit: The idea was to curtail the amount Russia makes from its oil while ensuring it continues to flow into the global market to reduce price pressures on consumers around the world.
Despite Western sanctions and price caps imposed on Russian oil exports, the country s revenues have actually increased due to rising oil prices and a squeeze on supply in global markets. The price cap restricts the sale of Russian oil to third parties and requires them to use services provided by G7, EU, and Australian entities. However, breaches of the cap have been reported, and Russia has reduced its reliance on Western services. Additionally, the long-standing challenges facing Russia s oil industry, such as the decline in output from brownfields and high carbon intensity, could have a sustained negative impact on its oil wealth.