Information on current losses of Russia due to sanctions as of 18.05.2026.
1. Financial Abyss: Why the Russian Economy Has Turned into a Bottomless Resource Devourer.
– Despite the oil rally from the war in the Middle East, the Russian economy shrank by 0.2% in the first quarter of 2026. This is attributed not only to sanctions but also to the increasingly harsh and chaotic policies of the Kremlin itself.
– Following the inflation spike due to military spending, the Russian authorities simultaneously raised taxes, sharply increased interest rates, and complicated the operations of small businesses.
– Additional blows came from restrictions on parallel imports, the campaign of “nationalization” of assets, and increased control over the internet, which is already slowing down the digital economy.
– As a result, Russian companies are mired in debt and have begun to cut expenses, while the population switches to a savings mode — people massively reduce consumption, delay purchases, and try to repay loans.
– Even additional oil revenues do not spark economic growth but merely temporarily cover budgetary and corporate problems. The Russian government has already lowered its 2026 economic growth forecast from 1.3% to 0.4%.
– The current model increasingly resembles a “neo-Soviet” system with manual economic management, where resources go not for development but to support the country’s survival in conditions of a prolonged war and isolation.
2. Russian Diesel Fuel Rail Exports to Nearby Countries Fell by 27% in April.
– Even key buyers have begun to reduce purchases, which increasingly hits Russia’s fuel export. The largest importer of Russian diesel remains Mongolia, but even it reduced purchases by 17.3% for the month.
– The worst situation is in Uzbekistan, where supplies plummeted by 78% compared to March and by 52% year-on-year.
– Reasons for the decline include increased domestic production in some importing countries, the reorientation of Belarusian transit, and attempts by Russia to redirect some flows through seaports.
– For Moscow, this is another signal of a worsening situation in oil product exports. After attacks on refineries, logistical problems, and sanction pressures, it is increasingly difficult for the Russian fuel sector to maintain even traditional markets near Russia.
3. Following the Mass Exit of Western Businesses, Chinese Companies Rapidly Occupy the Russian Market.
– Already every fourth foreign company in Russia has Chinese founders, although until 2022 their share did not exceed 4%. Currently, over 15,500 companies with Chinese participation are registered in Russia, and since the beginning of 2026, more than 1,500 such firms have been established.
– Chinese businesses are actively entering trade, logistics, industry, and equipment supply, displacing the remnants of European companies.
– For Moscow, this increasingly means not a “turn to the East,” but growing dependence on China. The Russian market is quickly turning into a platform for Chinese capital, technologies, and goods, while Russia’s own ability to dictate terms of cooperation is noticeably diminishing.
4. Russia expands LNG fleet with four tankers to increase exports.
– Moscow is trying to expand LNG exports bypassing Western sanctions by increasing the “shadow fleet” of gas carriers. At least four tankers, which previously operated on the LNG project in Oman, are now used to transport Russian fuel.
– The vessels in question are “Kosmos,” “Merkury,” “Orion,” and “Luch,” which have begun loading near the floating storage “Saam” near Murmansk. Fuel from the sanctioned “Arctic LNG-2” project, which remains one of Russia’s key yet problematic energy assets, accumulates there. These tankers show typical signs of a “shadow fleet”: old vessels, opaque ownership structures, and transfer to little-known companies.
– In total, at least 20 gas carriers are already used to transport Russian LNG under sanctions. The Kremlin’s attempt to boost logistics indicates that sanctions continue to create serious problems for Russian LNG.
– The lack of vessels, insurance, and access to international infrastructure remains one of the main bottlenecks for exporting Russian gas from the Arctic.
5. The reorientation of Russian LNG to Asian markets after losing Europe results in a sharp increase in costs and new selling challenges for Moscow.
– The logistics of supplying to Asia will cost Russia at least twice as much as exporting to the EU. The European market provided short and cheap routes: delivery from “Yamal LNG” to Northwestern Europe took 17–20 days. In contrast, deliveries to India or other Asian countries through the Suez Canal take 50–60 days, and through Africa up to 80 days.
– This reduces the turnover of gas carriers and increases freight costs. The transportation cost of Russian LNG to Europe was estimated at $1–1.5 per million BTU, while delivery to India now costs $2.5–5 per million BTU. With the longest routes, the break-even point for Russian gas approaches $7 per million BTU, which is critical for price-sensitive Asian markets.
– Sanctions pose an additional problem. India has already refused to purchase a batch of Russian LNG from the sanctioned “Portovaya LNG” project. The tanker Kunpeng, headed to India, effectively stalled off the coast of Malaysia after the buyer declined the cargo.
– Russia also faces limitations in its own logistics strategy. The Kremlin bet on the Northern Sea Route, but due to a shortage of ice-class gas carriers, this route proved the most expensive for deliveries to South Asia. For stable exports through the Arctic, dozens of ice-class tankers are needed, which Russia lacks.
– As a result, even after 2027, a significant portion of Russian LNG to Asia will have to follow traditional routes past Europe, making exports more expensive, slower, and less competitive.
6. Slovakia is preparing for a long-term contract to supply gas from Azerbaijan, seeking to gradually reduce dependence on Russian fuel.
– According to Deputy Prime Minister Tomáš Taraba, Bratislava is already discussing the logistics and available capacity of the gas transportation system for supplying energy resources to Central Europe.
– Negotiations between Slovak company SPP and Azerbaijani SOCAR are still in the early stages, but a potential 10-year contract is being discussed.
– The search for alternatives intensified after the EU’s decision to gradually phase out Russian gas and the expiration of the transit agreement between Ukraine and Russia at the end of 2024.
– The first supplies of Azerbaijani gas to Slovakia began in December 2024 as part of a test short-term agreement. Now, Bratislava is trying to turn this route into a stable alternative to Russian imports.
– Although the logistics of Azerbaijani gas supplies remain challenging, the very fact of seeking new routes and partners indicates the gradual displacement of Russia from the European gas market.
7. Poland is strengthening sanction pressure on supply chains for the Russian military-industrial complex.
– Warsaw has added Polish company Alliance Capital KS and Uzbek Chemistry International to the sanctions list. According to the Polish Ministry of the Interior, the Uzbek company controls about 85% of the export of cotton cellulose from Uzbekistan to Russia.
– This raw material is used to produce nitrocellulose — a key component of smokeless powder and ammunition for the Russian defense industry.
– European countries are increasingly blocking supply channels of critical materials for the Russian military-industrial complex through third countries.
8. The German company Global Trade, which according to the investigation was controlled from Moscow, organized a large-scale scheme for supplying prohibited goods from the EU to the Russian military-industrial complex.
– Over four years, this network handled about 16,000 shipments worth more than 30 million euros.
– After the start of the full-scale war against Ukraine, direct shipments to Russia were replaced with a more complex scheme through Turkey. Formally, it involved civilian products — microcontrollers, sensors, electronic components, bearings, measuring equipment, and mechanical parts.
– However, German investigators established that a significant portion of the cargo eventually ended up in Russian military enterprises and structures involved in nuclear weapons research.
– According to the Federal Prosecutor’s Office of Germany, goods were often delivered to Russia within just 5–10 days despite EU sanctions. The case materials also mention components for water desalination systems that could be used on nuclear submarines. Moscow continues to use intermediaries and shell companies to circumvent sanctions and support the military-industrial complex.
– At the same time, this increases pressure on the EU to block gray export schemes of dual-use goods through third countries.
