- Russian President Vladimir Putin has signed an order banning and restricting some exports and imports.
- Russia is a major exporter of commodities including oil, gas, wheat, and metals.
- Commodity prices have already surged due to Western sanctions over the war in Ukraine.
Russia President Vladimir Putin has signed an order banning the exports of some goods and raw materials.
The order includes a ban or restrictions on “exports outside of the Russian Federation’s territory and (or) imports to the Russian Federation’s territory of products and (or) raw materials,” according to an Interfax news translation of the order released on Tuesday.
The document said the ban goes into effect immediately but did not state which goods and raw materials will be affected by the restrictions. The Kremlin has ordered the government to compile a list of foreign countries that will be subject to the restrictions, Interfax added.
The ban and restrictions will be in place until December 31 this year, per Interfax.
Russia said on February 25 that it will be imposing “retaliatory measures” against Western sanctions, the state-owned TASS news agency reported.
Russia is a major exporter of commodities including oil, natural gas, wheat, and metals. Prices of the commodities have already surged on the back of supply disruptions due to the war in Ukraine and Western sanctions.
Oil prices are up 60% year-to-date, wheat prices have hit record highs, and prices of nickel and palladium have skyrocketed to historic highs.
“Russia’s energy supplies are very much at risk, either due to being held by Russia as a weapon or swiped off the market due to sanctions,” Louise Dickson, a senior oil market at Rystad Energy, said in a note on March 1.
“The war in Ukraine is getting very ugly and destructive and hostilities between the West and Russia is intensifying. High risk for disruptions to both crude and natural gas,” said Bjarne Schieldrop, chief commodities analyst at Swedish bank SEB on March 1.
Russia has already started taking retaliatory actions against Western sanctions, banning airlines from 36 countries from its airspace from February 28. It has also created an “unfriendly countries” list that includes the US, UK, EU countries, Australia, Canada, and Japan.
On Monday, Russia’s Deputy Prime Minister Alexander Novak issued a threat to cut natural gas supplies to Europe via the Nord Stream 1 pipeline.