The US and Israel launched a war against Iran on February 28, targeting Tehran’s military and naval forces, killing several of its top leaders, including Supreme Leader Ayatollah Ali Khamenei. The conflict prompted Tehran to retaliate, with US military installations and Israel targeted by drones and missiles, plunging the wider Gulf region into a deeper and wider military confrontation.
While many continue to speculate who could win the war, the United States or Iran, a report from CNBC suggests that the real winner of this war could be Russia.
How can Moscow win from a US-Israel-Iran war?
Citing analysts, the report suggests Moscow will benefit greatly from the war as higher oil prices and temporary sanctions relief boost the value and volume of its oil exports.
Russia is benefiting from higher oil prices, especially after the U.S. eased restrictions on India buying Russian oil, Saul Kavonic, head of energy research at MST Marquee, told CNBC.
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Moscow, which remains the world’s largest oil exporter despite sanctions after launching a full-scale war with Ukraine in February 2022, will see rising prices translate into higher government revenues.
How did India’s purchase of Russian oil help Moscow?
Analysts believe Moscow has “already benefited enormously” from the conflict after Washington granted Delhi a temporary exemption to buy Russian oil. US President Donald Trump said in February that India had agreed to stop buying Russian oil as the two sides signed a bilateral trade agreement (BTA).
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In addition, Russian cargo was selling at $90 a barrel, a big increase in prices and sales volume, the analyst said, noting that before the Iran war it was selling at $50 a barrel.
The renewed buying from India helped Russia boost oil prices while clearing a backlog that had accumulated at sea. Russian crude held on tankers fell to 118.3 million barrels this week, down from 132.9 million barrels in February, according to data from Kpler, suggesting cargo is now reaching buyers faster.
Temporary easing of sanctions to help Russia
Russia’s chances of emerging victorious from the war are further boosted by temporary sanctions relief that will allow more barrels of oil to remain in circulation, providing a short-term boost to the country’s finances.
According to a Reuters report, Trump is considering easing oil sanctions against Moscow and releasing emergency oil reserves as part of a package of options aimed at curbing a sharp rise in global oil prices. The report suggests the talks show the White House’s concerns over a sharp rise in oil prices may also affect American businesses and consumers ahead of November’s midterm elections, when Republicans hope to retain control of Congress.
Global energy markets were rocked
Oil prices jumped to $120 a barrel on Monday (local time), days after Iran’s Islamic Revolutionary Guard Corps (IRGC) closed the Strait of Hormuz, a key route responsible for about 20% of the world’s oil supply. The closure of Hormuz and continued Iranian attacks on oil facilities in Middle Eastern countries have rattled global energy markets as fears of supply disruptions now emerge.
While oil prices fell nearly 7% on Tuesday (local time) after US President Donald Trump said the war with Iran could end soon, they were still 27% higher than when the conflict began in late February.
If the conflict in Iran continues to limit exports from the Persian Gulf, the upside for Russia could be huge. An analyst predicts that Moscow could generate tens of billions of dollars in state revenue as oil and gas prices remain high.
