With Europe weaning itself off Russian oil, natural gas and coal, President Vladimir Putin has ordered a full-scale reorientation of Russia’s commodity exports by shipping more cargoes to Asia, building new pipelines and expanding railroad links to the East.
But in redrawing its exports map, Moscow faces significant hurdles, putting its sanctions-stricken economy further at risk. European Union officials this week are preparing a sixth round of sanctions that aim to undercut Russia’s energy exports.
Among the proposals are a phased ban on Russian oil purchases as well as sanctions on service providers, such as ship insurers, that would stifle Russian crude shipments to other parts of the world.
The new infrastructure that Russia needs to transport the exports that Europe used to buy will take years to build. It is experiencing difficulties chartering ships to transport its oil as insurers and banks fear the impact of sanctions. Major trading houses, meanwhile, are cutting their Russian business.
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