Self-sanctioning, or the unilateral rejection of Russian commodities by Western purchasers, was supposed to begin affecting crude oil, LNG, and coal shipments in April, but there are already signs that flows are slowing. Following Russia’s invasion of neighbouring Ukraine, several Western corporations have withdrawn their investments in Russia and reduced or halted their imports of energy supplies, which are the country’s basis. While Western governments have not directly sanctioned energy commodities, many corporations are reluctant to buy from Russia due to a mix of public resistance, financing, insurance, and ship owners’ unwillingness to load from Russian ports.
Because most March cargoes would have been booked prior to Moscow’s first attack on Ukraine on February 24, this self-sanctioning was predicted to have a significant impact on Russia’s exports starting in April. However, there are already signs that exports are slowing, with coal shipments being the hardest hit thus far.
According to Refinitiv statistics, filtered to indicate only vessels that have either sailed or are in the process of being loaded, Russia’s coal shipments to Europe totalled 1.16 million tonnes in the first two weeks of March. Russia exported 3.37 million tonnes of coal to Europe in February, compared to 3.88 million tonnes in January.
Russian coal exports to Asia also are on track for a sharp slump in March, with Refinitiv showing just 1.84 million tonnes being shipped in the first two weeks, and no cargoes currently being arranged. Russia exported 6.16 million tonnes of coal to Asia in February and 4.88 million in January, according to Refinitiv, with China being the biggest buyer. It’s possible that more vessels for Europe and Asia will be arranged and loaded in Russia in the rest of March, but Refinitiv data is currently showing only a small 2.4 million tonnes of potential exports for the remainder of the month for all destinations. If Russia’s coal exports are sliding, its shipments of crude oil appear to be largely holding up in March, especially to Asia. Russia is on track to export about 33.89 million barrels of crude to buyers in Asia in March, similar on a barrels per day (bpd) basis to the 30.02 million in February, and slightly below the 36.24 million in January.