Russia’s oil exports crashed to their lowest point since the Ukraine war began, weighed down by buyers moving away from Moscow amid tightened US sanctions and Kyiv’s escalating attacks. In its latest assessment, the International Energy Agency (IEA) noted that Russian oil exports declined by 420 kb/d in November, pulling total shipments down to 6.9 mb/d.The drop in volumes and weakening prices pushed Moscow’s oil revenue down to $11 billion, which is $3.6 billion less than the same month last year. The IEA added that both export volumes and prices have dropped, “dragging export revenues to their lowest since Russia’s invasion of Ukraine in February 2022.”

Urals crude prices plunge

As exports dragged down, Urals crude prices also tumbled by $8.2/bbl to $43.52/bbl (one barrel is about 159 litres). This marked the lowest level since the start of the Ukraine conflict in February 2022.According to the IEA, this downturn pushed export revenues to their lowest monthly level since the invasion began.

Impact of Ukrainian strikes and Russia’s “shadow fleet”

The IEA said Ukrainian attacks on Russia’s sanctions-busting “shadow fleet” and marine oil facilities cut almost half of Russia’s November seaborne exports through the Black Sea.The pressure on shipments and prices comes as Russia struggles with meagre economic growth, the accumulated impact of sanctions and Ukrainian strikes on its energy infrastructure.Ukraine intensified strikes on Russian refineries over the summer and early autumn, causing domestic petrol prices to spike and prompting some Russian regions to introduce fuel rationing.“After weathering significant unplanned refinery outages in November, tightness in refined product markets has eased, but sanctions in 1Q26 will provide fresh challenges,” the IEA said.

Russia’s budget under strain

The Russian finance ministry reported that oil and gas revenues for the first nine months of the year were down 22% to $88 billion.A combination of high military spending, entrenched inflation and falling oil income has stretched Moscow’s budget. Russia is expected to post a $50 billion deficit this year, around three percent of GDP, and plans to raise taxes on consumers and businesses next year to narrow the gap.

US escalates pressure with tariffs and sanctions

The United States has warned several countries that they may face additional tariffs and punitive trade measures if they continue buying Russian oil. The EU has Washington recently imposed an additional 25% tariff on imports from India, citing its continued purchases of Russian crude. This was on top of the 25% tariff previously announced by US President Trump.In October, the US unveiled some of its toughest measures yet on Russia’s energy sector by sanctioning Rosneft and Lukoil, the country’s two biggest oil producers, in an effort to pressure Moscow to end the nearly four-year war in Ukraine.

Global supply slips

Global oil supply fell by 610 kb/d in November, extending cumulative declines from September’s record high of 109 mb/d to 1.5 mb/d, the IEA said.OPEC+ accounted for more than three-quarters of the overall drop, driven mainly by sanctions-hit Russia and Venezuela. The group contributed 80% of the supply decline over the past two months, reflecting major unplanned outages in Kuwait and Kazakhstan, alongside continued contractions in Russia and Venezuela.Among non-OPEC+ producers, the United States, Brazil and biofuels were also contributors to the global supply decline.

Outlook — What will happen in the oil sector?

Despite recent market tightness, the IEA projects global oil supply to grow by 3 mb/d in 2025 and a further 2.4 mb/d in 2026. However, the agency revised its supply growth forecasts downward, by 100 kb/d for 2025 and 20 kb/d for 2026 — to 106.2 mb/d and 108.6 mb/d respectively.On the demand front, world oil consumption is expected to rise by 830 kb/d in 2025, supported by improved macroeconomic and trade conditions. The IEA has also upgraded its 2026 demand outlook to 860 kb/d, an increase of 90 kb/d from earlier estimates.Gasoil and jet/kerosene are projected to account for half of this year’s demand growth, while fuel oil continues to lose ground due to substitution by natural gas and solar in power generation.