How the Shunning of Russian Oil Leaves a Hole in the Market

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While the U.S. and U.K. have banned imports of Russian oil, sanctions punishing Russia for its invasion of Ukraine have mostly not targeted its energy exports. Nevertheless, Russian crude is being shunned in what some traders are calling “self-sanctioning.” Because of confusion about what’s legally permitted, fears about how the European Union might join its allies in turning away from Russian energy and concern about reputational damage, banks are pulling financing, buyers are holding back and tanker operators are reluctant to ship. The squeeze has started to have the same effect as a wider embargo. Since Russia is the world’s second-biggest crude exporter, it’s leaving a big hole in energy markets, sending the price of oil rocketing.