An exiled Russian oligarch says a European ban on Russian oil and gas would deal a ‘very serious blow’ to Putin, cutting off around half his revenues

• Europe banning Russian energy would be a “very serious blow” to Putin, Mikhail Khodorkovsky said.
• He told BBC Hardtalk that the West’s dependency on Russian imports was a “mistake” it would have to pay for.
• Khodorkovsky, an exiled oligarch and former CEO of Yukos, is an outspoken critic of the Kremlin.

President Vladimir Putin would suffer a “very serious blow” if European countries stopped purchasing Russian oil and gas, an exiled oligarch who once headed up one of the country’s former oil giants said.

“If Putin has to redirect oil and gas exports from the European to the Asian markets, he will lose over half of his revenue,” Mikhail Khodorkovsky told BBC Hardtalk’s Stephen Sackur. Revenues from oil and gas made up 36% of Russia’s federal budget in 2021, according to preliminary figures from the country’s finance ministry.

“Would he be able to continue the war and for how long would he be able to continue the war under those circumstances? It is difficult for me to say,” Khodorkovsky, an outspoken critic of the Kremlin, continued. “But I think it would be a very serious blow.”

US President Joe Biden has pledged to ban Russian energy imports, but the European Union, which gets about a third of its natural gas and oil from Russia, is finding it much harder to cut ties.

The International Energy Agency said on April 13 that Russia exports around $400 million of natural gas to the EU every day, and makes around $700 million in daily revenue from exports of crude oil and refined products.

“The West made the fatal mistake of becoming reliant on Russian energy supplies,” Khodorkovsky said. “Today the West has to pay for its mistakes.”

According to the IEA, oil shipments from Russia to Europe continue as a result of agreements struck before the invasion of Ukraine, but new deals are “drying up.”

“Buyers are avoiding Russian crude because of concerns about shipping safety, insurance and sanctions. Urals crude from Russia is being offered at record discounts, but uptake is limited so far, with Asian oil importers for the most part sticking to traditional suppliers in the Middle East, Latin America and Africa,” the agency said.

Ukrainian President Volodymyr Zelenskyy has previously spoken out against European countries continuing to Russian energy supplies, telling the BBC that they were making money “out of blood.”  Zelenskyy’s top economic adviser has said that Ukraine would prosecute companies that he said were committing “war crimes” by continuing to trade in Russian oil and gas.

“I think what we have is tension between what is preferable and what is possible,” Khodorkovsky told The BBC. “It is preferable, of course, to make it impossible for Putin to pay for his aggression with the money from oil and gas exports. But is it possible today? Perhaps.”

Western nations have imposed sweeping sanctions on Russia in an attempt to cut off some of the Kremlin’s financing and pressure Putin to call off his invasion of Ukraine. German Chancellor Olaf Scholz, however, has said a Western embargo on Russian gas imports probably wouldn’t stop the war, telling Der Spiegel that Putin would never have started the war if he were open to economic arguments.

Khodorkovsky was once Russia’s richest person

Khodorkovsky was CEO of Yukos, then Russia’s largest oil company, between 1997 and 2004. He was briefly Russia’s richest person in 2003, when Forbes put his net worth at $15 billion. 

In 2001, he founded Open Russia, an anti-Kremlin political organization focusing on democracy and human rights that was shut down by Russian authorities in 2006. Khodorkovsky was arrested and charged with fraud and tax evasion in 2003 and was sentenced to nine years in prison in 2005.

In 2013, he was pardoned by Putin and released from prison a year early. He was exiled from Russia and now lives in London.