Putin claims the latest sanctions have no impact on Russia, but cannot conceal the shivering of Moscow’s capital markets.

Summary: Putin claimed the latest sanctions have not affected Russia’s economy—but in reality, they caused the market valuations of Russia’s two largest oil companies to evaporate $5.2 billion in a single day. The U.S.’s newest sanctions severely damaged Russia’s energy exports, potentially triggering chain reactions such as reduced counterparty participation and expanded transportation discounts. Russian customs revenue has already declined by one-fifth; economists forecast that oil-and-gas revenues will drop another one-third next year, intensifying recession risks and jeopardizing the sustainability of the war. On October 23, Russian President Vladimir Putin told media in an interview that the United States’ new sanctions against Russia aim to pressure Moscow but will not significantly affect the Russian economy. Frankly speaking, logically speaking, how could sanctions possibly have no effect on Russia? If they truly had no impact, why has Russia consistently opposed Western sanctions—and repeatedly demanded their removal as a precondition for ceasefire? In fact, immediately after the U.S. and EU announced their latest sanctions against Russia, both the Russian market and the Kremlin responded directly. First, the market values of Rosneft and Lukoil plummeted by $5.2 billion. People often say that verbal expressions of support or opposition can be insincere—but investors vote with their money, and that is the most truthful indicator. On the first and second days following the imposition of U.S. sanctions on Russia’s two largest oil companies, Rosneft and Lukoil led sharp declines among blue-chip stocks on the Moscow Exchange. On the evening of October 23, Russia’s business newspaper Kommersant cited data from the Moscow Exchange reporting that, over Thursday and Friday, the combined market capitalization of Rosneft and Lukoil fell by 424 billion rubles—$5.2 billion. As of 8:00 p.m. Moscow time on Friday, Rosneft’s share price stood at 389.85 rubles per share—a 3% decline from pre-sanction levels. During trading, its share price dipped as low as 383.15 rubles—the lowest since May 2023. As a result, the company’s market capitalization dropped by 127 billion rubles ($1.56 billion). Lukoil’s share price fell 7.2% over the two days, wiping out 297 billion rubles ($3.66 billion) of its market value. Kommersant reported that Vagit Alekperov—the principal owner of Russia’s wealthiest oil company, Lukoil—holds a 28% stake; he lost 83 billion rubles (just over $1 billion) in those two days. Russian analysts noted that state-owned Rosneft suffered smaller losses than privately held Lukoil because the oil pipeline linking Russia to China remains outside the scope of current sanctions—ensuring Rosneft a baseline level of operating revenue. Moreover, pipeline oil exports command higher prices while incurring lower transportation and other ancillary costs, thereby securing Rosneft with stable profits. Above: Igor Sechin, head of Rosneft—the largest energy company in Russia. According to a Kommersant report dated August 30, both Rosneft and Lukoil had already experienced a sharp deterioration in financial performance during the first half of this year: Rosneft reported that its profit fell from 245 billion rubles to 77.3 billion rubles in the first half.

Russia’s ‘energy weapon’ dream shattered.

Since January 2023, the discount on Urals crude oil has widened significantly. In early January 2023, Urals crude exported from the Baltic port of Primorsk sold for just $37.80 per barrel—half the price of Brent crude at the time, and far below the $60 price cap. Based on a five-day moving average, on January 24, 2023, Urals crude traded $31.50 per barrel below Brent. According to data from Russia’s Ministry of Finance, the average price of Urals blend crude between December 15, 2022, and January 14, 2023, was $46.82 per barrel—18.5% lower than the $57.49 per barrel recorded one month earlier, representing a $10.67-per-barrel decline. Compared to the 2022 annual average sales price of $76 per barrel, it fell by $29.18—down 38.4%. Over the same period, the average spot closing price of Brent crude stood at $81.70 per barrel, meaning Urals traded at a staggering 43% discount relative to Brent. This steep price discount has eroded Russia’s petroleum export earnings. According to estimates by the International Energy Agency (IEA), the record-breaking discount on Russia’s benchmark Urals crude caused Russian oil revenue to fall by $3 billion within a single month—dropping to $12.6 billion in December 2022. A report released in early January 2023 by the Finland-based Centre for Research on Energy and Clean Air (CREA) estimated that the G7’s price cap would cost Russia $174 million per day ($160 million euros). CREA assessed the combined cost of the price cap and broader sanctions at approximately $172 million per day. Russian economist Alexander Isaakov told Bloomberg that falling global energy prices—coupled with the widening Urals discount—have already wiped out $20 billion of Russia’s oil export revenue. Although Russia adopted a tough rhetorical stance in response to the G7’s price-cap initiative, its actual effects so far have been largely emotional—with no effective countermeasures yet visible. In practice, Russia has mostly endured the measure passively and humiliatingly. Just after G7 finance ministers announced their intention to implement the price cap, on September 7, 2022, at the plenary session of the Seventh Eastern Economic Forum in Vladivostok, President Putin called the move to cap Russian energy prices an “absolutely foolish decision” and threatened to halt supplies of natural gas, oil, coal, or fuel. On December 27, 2022, Putin signed a presidential decree outlining retaliatory measures against Western price caps on Russian oil, stipulating that Russian crude and petroleum products may not be supplied to foreign legal entities or individuals if the sales contract employs the price-cap mechanism—either directly or indirectly. On January 30, 2023, Russia’s official Legal Information Portal published a decree signed by Prime Minister Mikhail Mishustin on January 28, 2023, requiring Russia’s Ministry of Energy and Ministry of Finance to approve a monitoring procedure for Russian oil export prices by March 1, 2023. Yet in reality, market observers see that—despite a modest volume decline—most of Russia’s crude oil exports continue operating normally under the price cap.

Putin Imposes Sweeping New Reporting Limits on Russian Energy

Sep 28, 2026

Russian President Putin signed a decree prohibiting the publication of detailed energy export contract and refinery production data, citing US sanctions as justification. This further restricts transparency in one of the world's top oil-and-gas producing nations.

bloomberg

2026-05-28

Russia and Kazakhstan Sign Energy, FX Swap Deals as Putin Visits

2026-06-02

Putin's 'Davos' Haunted by War and Stagnation Despite the Swank of Influencers

2026-08-24

Putin Authorizes State Takeover of Vulnerable Critical Infrastructure

2026-09-17

Putin says Russia's 2027 budget deficit seen at around 2% of GDP

2026-09-28

Putin Further Restricts Disclosures on Russian Energy and Refining