Rising oil prices after Israeli strikes on Iran may increase Russia's revenues from energy sales and improve Russia's ability to support military operations in Ukraine. This is stated in a material of the Institute for the Study of War (ISW), reports UNN.
Details
Analysts point out that after Israel's strikes on Iran, Brent crude futures rose by more than five percent to $74.47 a barrel.
Russia's oil and gas revenues accounted for approximately 30 percent of total federal revenues in 2024, highlighting the significant role that oil and gas revenues play in financing Russia's public spending.
They emphasize that tightening economic restrictions on Russia are increasingly hindering Russia's ability to sustain a prolonged military effort in Ukraine.
Russia is likely to be able to use sudden spikes in oil prices to overcome economic challenges and finance a prolonged war in Ukraine, assuming that the price of oil remains high (for example, above $60 per barrel)
Analysts also recall that Russian dictator Vladimir Putin has previously expressed concern about falling oil prices, suggesting that any fall in the price of oil is likely to destabilize the Russian economy.
Context
Global oil prices have soared amid fears of a larger war after Israel's attack on Iran. Brent crude rose to $78 a barrel on the morning of June 13, the biggest jump since 2022.
A few days ago, the European Union proposed an 18th package of sanctions against Russia, which includes lowering the oil price cap to $45 per barrel and measures against Russia's "shadow fleet".