Despite a raft of sanctions and tough talk against Russian President Vladimir Putin, Europe could not seem to kick its dependence on Russian fuel last year.
The European Union (EU) spent $23 billion on Russian oil and gas in the third year of the war on Ukraine, more than the $19.6 billion in financial aid it offered to the war-ravaged nation last year, according to the Centre for Research on Energy and Clean Air.
Russia's stronghold over non-EU markets also increased - China purchased $82 billion in Russian fuel, India bought $51 billion and Turkey bought $36 billion.
Russia earned $254 billion from fossil fuel exports last year, a 3% drop over the previous year.
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Despite Western bans on Russian crude and refined products, Russian oil exports are down a mere 8% since before the invasion of Ukraine. The Kremlin has made close to $1 trillion from oil exports since February 2022.
Russia relied on its "shadow" fleet of 585 oil tankers to transport many of its exports, intended to mask their origins. Russia purchases aging ships from European owners, frequently reflags the ships and uses shell companies to obscure their Russian origins.
Russia also exports oil to third-party states that have not placed sanctions on Moscow, who in turn sell it to the West.
CREA's analysis found that tighter sanctions could slash Kremlin revenues by as much as 20%.
Last week, the EU adopted its 16th package of sanctions against Russia in an effort to crack down on Russia's shadow vessels.
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Russian prices are still lower than buying fuel elsewhere, according to Jonathan Bass, founder of Argent LNG.
"Russian pipeline gas has been cheaper than LNG prices, even with the geopolitical risk, the European buyers still find Russian gas economical."
Europe's Russian fuel dependence, in large part, is due to the Biden administration's restrictions on liquefied natural gas (LNG) exports, according to Bass. President Donald Trump lifted that pause in a day-one executive order.
After the invasion, "Europeans went in and said, 'okay, we're gonna rely on American LNG.' But then Biden pauses it… That made the Europeans afraid of relying on America's political swings," Bass said.
Cutting off Russian gas has been difficult for landlocked European nations like Austria, which until recently relied on importing fuel by pipeline. A pipeline that fueled Russia by passing through Ukraine and Slovakia stopped flowing at the beginning of this year.
"The re-gasification and distribution infrastructure isn't optimized for importing from elsewhere. They rely on pipelines [that originate] from Russia," Bass said.
In January, then-President Joe Biden imposed the toughest sanctions package yet on Russia's oil industry, targeting 161 Kremlin-linked tankers.
Last week, European leaders issued a unified display of support for Ukrainian President Volodymyr Zelenskyy after his spat with Trump in the Oval Office that prompted an abrupt halt to peace talks.
European leaders held emergency talks on Sunday in London to take the reins of peace talks while Trump and Zelenskyy were at odds.
Bass, meanwhile, said oil and gas firms are calling for direction from the Trump administration on how big a priority U.S. exports will be to decrease the global dependence on Russian fuel.
"The President's got to say more than 'drill, baby drill.' Because he said 'drill baby drill,' and then his actions are, go to Russia."
"What we need to be we really need assurance of direction and supply of what the administration wants us in the gas LNG business to do," he went on. "Don't do a Biden on us. If you want them to be supplied out of Russia, that's the intent then we'll find other markets. But we don't need more flip-flopping - Biden set this whole Russia-Ukraine war up when he stopped dependence on American energy."
