US blow to Turkish-Russian trade: Oil trade at risk

12PUNTO FOREIGN NEWS

Following the US sanctions announcement, the trade volume between the two countries has begun to decline.

Although the US sanctions decision does not directly target Russia's energy exports, it has made crude oil imports from Russia more complicated. Payments from Turkey to Russia have come to a standstill. While oil shipments from Russia to Turkey continue, no solution has yet been produced regarding how payments will be made. If the 'payment crisis' continues, Turkey's oil imports from Russia could be disrupted.

According to experts, the US sanctions were intended to disrupt Russia's revenues without causing global oil prices to rise excessively. Russia's oil trade with India, the UAE, and China has also been disrupted.

Russia is currently the country that exports the most crude oil and diesel to Turkey. Turkey imports 8.9 million tons of crude oil and 9.4 million tons of diesel from Russia every year.

WILL THE CRISIS DEEPEN?

The tightening of 'compliance criteria' by Turkish banks regarding Russian clients and companies is cited as the primary reason for the payment issues. According to these criteria, for payments to be made from Turkey to Russia, the institutions receiving the funds must be exempt from the sanctions announced by the US.

According to a Russian oil company official who spoke to Reuters, no customers from Turkey have made payments in the last two to three weeks.

In the same report, Reuters also included the words of a Turkish official: "After the latest sanctions, it has become difficult to make energy payments to Russia. Some payments have been delayed."

According to the Reuters report, Russian officials stated that oil shipments are continuing, but if the problem is not resolved, oil exports to Turkey could begin to be disrupted. Turkish officials, meanwhile, stated that 'meticulous work' is being carried out to resolve the issue, adding that banks are working on 'compliance issues' and that payment problems will be resolved soon.

News Source: 12punto