the stay with us now after a short break clear richardson leaves to the point, asking if the west can keep up and support for ukraine. really think so much for a company, the cost from a sponsor. it's one of the sale when he knows how to use it and pretend this guy knows about energy in a way that these is like structures have no idea what doesn't look behind. but the thought of this energy time tell us gas problem pressures, political wedding, thoughts, february 3rd, i'm dw, you. cran says it's in danger of losing the war on russia is more confident of victory than ever. and here's one of the biggest reasons. oil russians most important and most enjoying weapons. the country wrecked in at least

$280000000000.00 us dollars for more than 2022. and that's why western leaders made a demand target of their sanctions against moscow. the oil price cap is the west most important sanction. it was designed to keep russian oil flow into the global market. was also limiting the amount of money the kremlin could make from us for a while as worked not anymore. when the price cap was introduced, it had a 2 year impact on the price russian golf for its oil for almost 6 months now, russian oil has been sold on global markets well above the price cap of 60 us dollars. 3 and which g 7 states cut off access to their services for the 1st time, hoping to get 3 if we can really suffer from full price, can now see, hey, turns out the circumstances. in this episode, we look at how russia rejuvenated its own revenues. and we will consider what options ukraine on its allies have to hit by. there's a kind of

a sense of which you see and make some adjustments to the same. you now to make sure that the pressure on rushes things as the war drags on questions are being asked of how long both sides can fall into the fights threat. david's overhead along western support for ukraine will last, and russia is ramping of ministry spending. the huge increase in budgets pending for next year. they're talking about going from 4 percent of the 50 feet to 6 percent. that you think the basis of all this is a law how long i should be staying this war. unfortunately for an extended period. welcome to business beyond. let's go back a little bit after the full scale russian invasion of ukraine in february 2022. the us that you and the other western powers introduced a range of sanctions, which mostly targeted russia's financial system. hundreds of billions of dollars worth of russian central bank reserves held abroad were frozen,

while the country was also excluded from the swift international payments system. these sanctions are designed to take a heavy toll on the president's interests and their ability to finance war. the russian economy, whether those better than many experts expected a to but this still had an effect. so imagine the roll with those assumptions. so these are nodes things we can have access to western military technology or the purpose technology. who didn't came through with the over 2 months. so if you think about this world, i guess the outcome of the war on the better see what the new brain would have been very different. it's able to of the you was slow to target russian gas and oil early on. mostly because its own economy was still reliant on the part of the reason the kremlin made so much money in 2022 late last year. the you finally took

action on russian oil along with countries from the g 7 and australia. that was with the introduction of something which we've mentioned already and which you're going to hear a lot more about. and this episode, the price comp, the, if you decided that it was going to implement it's embargo on russian wasn't going in part of that it embargoed was. busy ready prohibition for your reputed service providers. i to participate in the state, but actually oil. and this would be, for instance, shipping companies and maritime insurance companies for energy prices, sore throat, 2022. and there were concerns that an embargo could push them up again, which would defeat the purpose of the sanction. out of this concern, the result is the concept of the price caps, which is a really a very complex intervention into the market. and the basic idea is that this

provision of the embargo that would prohibit those european companies from participating was rolled back as long as the oil was sold under a certain racial which was later set at 60 dollars per barrel. the oil price cap aims to keep russian oil on the global market, but also aims to limit the price it can be sold for. the companies from the e u r g 7 countries can provide services such as insurance for the transit of russian oil. but only if it is shown that the oil was traded for no more than 60 us dollars per barrel. well below average global oil prices. it wasn't unusual and somewhat daring intervention for the 1st few months. it worked like a charm. the cap had an immediate impact on revenues. in the 1st 6 months of 2023 brush, it took in 47 percent less an oil revenues than it did in the 1st 6 months of 2022

and a half for the loan revenues were 67 percent down year on year. broadly speaking, the energy sanctions regime had the desired impact. we know that the rest of the oil remain on the market. prices did not rise until at. ready least at the old us production cuts later in the year. and russian export earnings so sharply we think by about 30 percent a year to date and budget revenues from. ready oil exploring bias, something between 35 and 40 percent. but even before the cap was introduced, russia was working on ways to get around as one of the main ways is through its so called shadow fleece. the price is. ready need to ship oil from on vessels that are essentially sanctions bruce. so this is what is often talked about as the shows lead to the question, what exactly constitutes a shadow of leads back. so, but essentially means russia's ability to use ships that are not owned by

n s t in the g 7 or e u. and that is not insured by an, as in these jurisdictions. and then the price kept doesn't look like russia has a mazda fleet of hundreds of awesome aging tankers to move. it's all around the world without being subject to the con. the typically have complex ownership structures. many operate without a proper insurance. on the use various methods to avoid detection, including creating fake locations, signals. being able to settle it without abiding by the cap means russia is now getting close to average global prices per barrel. roche has capacity to keep going . doesn't mean that the western alliance doesn't have options. there's little doubt is that something needs to be done and don't fast. so if you ask the percentage points of view to be more than does it, i mean, is she will spend with the little,

even more price goes on. because for example, eventually the least, i shall be happy to go father, and that's the best his uh preference. and so i think i send you the, um, the basically the sanctions to reduce the amount of money if we can, can spend on the world is what needs to be done. there are things that need to be done to make sure there are pressure on it. actually is maintain, otherwise uh, the country will already significantly more from its oil exports going forward. and it's also a problem with the credibility of the broader sanctions. first, commission has already agreed a new round of sanctions against russia, although the exact details have not been released. the commission confirmed the following to dw in a statement. president funder lions said recently the new package would include new import and export bands, actions to type in the oil price cap, turf managers, and 3rd country companies which circumvent the sanctions. it's now up to the $27.00

e. u. member states to agree unanimously to the proposals, but there's no clear timeline on when that may happen. to have been reports that the proposals include plans for denmark to be given the task of inspecting and potentially blocking tankers carrying, rushing oil through the narrow danny straits. more than half of all russian seaborne or like sports crossed the straits. it's believe the danish authorities with target ships operating with the western insurance based on laws to do with environmental risk, with russia and having to go on the same kind of western insurance. the other schemes we believe that these insurance companies are actually not a national equipment to pay out in the case of and he could logical disaster. it's a genuine risk given how well and some of the tankers, russia is using our but introducing this function, code code rushes revenues typically require, for instance. busy optics,

the coastal states if. ready require certain insurance standards, and it would also force russia to rely again on western maritime insurance companies. and this would mean that the ratio price cap system remains place for longer. then there's the question of enforcement. we mentioned at the station from earlier that's what paperwork is falsified. just suggest ships are complying with sanctions. it's another area which needs to be tightened significantly. approaches revenues are to be restricted. last month, the us sanctioned 3 and you a best shipping companies for exporting russian oil above the price comp. benjamin higgins stock says the problem is ramping. current ways of dealing with us are nowhere near enough. it's very difficult for a forcing authorities to investigate and to determine if a violation actually took place here. and what we're thinking about here is original sales contracts,

banking transactions related to customs declarations that allow enforcing agencies to determine at. ready price, actually this cargo was sold right now. you only have this type of station which is essentially a one page document. uh, on which someone, uh says, this was sold at price capital or below, uh, and then something from that is, uh, entirely in that or so there's russia itself and the various companies providing dodgy services to help evade the price comp. but what about sanctioning the likes of china or india who buy so much of the oil? we should remember that uh, nobody wants to be sanctioned by the us for your business, very costing for anybody for once the work and the mobile mark. and so i think so the risk of coalition should the more of that, and remember my skip was design has such a way that it's good for the buyer. so train these buyers and siri, it isn't in

b as interest to pay less for rush results that could potentially tell the rush or the fear of sanctions means they won't pay above the cap. but there are clear reasons why sanctions against india or china are on like you're doesn't want to sanction china, because you don't want to play this role the call because you asked to have a bottom based on some consensus to be a best. so these are the train us doesn't want to sanction india because it is an important counter way in the sand though they've been us a chance. so we don't see union channels within less than coalition to go this. in the, near the 2 years since prudence troops, port across ukraine's borders, the russian economy has been hit with a way of unprecedented sanctions. a times it's ministry campaign of slandered it's been written off. but it's still going. a huge increase in the defense budget

suggests putting still as serious means at his disposal, which put him in charge. but this opened the price, i presume, in charge. i think they will manage as little as economy is not in the ruins, which is not the case is in the forecast for the 22 percent or 5 percent. there is no going to break a big political that we should dispense with the notion that sanctions alone in in this. ready war because they mean that russia no longer financed or gets more expenditures. i was think that's realistic. ultimately. ready also talking about a dictatorship and if you, if you prioritize, prioritize, deducting this war over everything else, then you can shift expenditures, given the limited battlefield progress for you, created recently on diet silver, continued western sup. busy pressures on to show that the sanctions state of matter

. i don't think any of these uh, developments or measures taken by themself. determine rushes ability that this for, it just makes it increasingly more painful. and that's why we said to keep working on making sure that the that the energy sections for seam remains effective. those who know russia and to best say that no amount of financial hardship would make him stop. the work is not going as they planned. but i mean, at least i know that it's in their mind that they need to read to you this war, and he will continue the war until his last breath. a sobering sauce for those willing ukraine to succeed, but also a call to action. to keep targeting filters and rushes most powerful weapons the,

the, for nato. a worst case scenario would be a russian attack on one of its members states. and now it is rehearsing for exactly that possibility. it's running, it's biggest military drill since the cold war to practice as the response. the exercise is called steadfast defender and it see some 90000 fruits from 32 countries taking part with fighter jets tanks and warships. that's all shortly before the 2nd day nursery of russia's full scale invasion of ukraine. since then, cube has fought to expel its invaders with help from western weapons. but will the support continue today on to the points we're looking at? is imperial ambitions and asking is the last week.