Sanctions imposed by Western countries in response to Russia’s invasion of Ukraine in February 2022 have had major implications for Russian fossil fuel and climate sectors, dramatically reshaping trading patterns, export revenues and economic incentives.
Although initial forecasts of the impacts of Western sanctions predicted a reduction in Russian GDP of between 10% and 12%, exploitation of sanction loopholes, increased trade with Asia, as well as the shift to a war economy, have mitigated these losses in the short-term with the Russian economy growing 3% across 2023 according to IMF forecasts.
In the long-term, the prospects for the Russian economy are less positive, with the lack of access to imported modern technologies, low levels of foreign investment and deteriorating human and social capital posing significant risks.
This research explores the effectiveness and impacts of current sanctions on the Russian fossil fuel and climate sectors, providing a deeper understanding of the new normal in Russia and hence the future economic sustainability of these sectors. Furthermore, the research aims to provide evidence-based insights for international policymakers to limit Russia’s war efforts and maintain ambition for international energy transitions.
For more information about the Russian coal sector before 2022, consult our project: The Russian Coal Sector: Challenges and Transition Opportunities.
