Singapore accused of being a "laundromat" of Russian oil helping to fund Putin’s war chest
The Centre for Research on Energy and Clean Air (CREA) has accused Singapore and others of being a "laundromat" for Russian oil, despite these countries imposing sanctions on Russia.
SINGAPORE — The Centre for Research on Energy and Clean Air (CREA) produced a report two months ago (April 2023) accusing Singapore and several other countries like UAE, China, India and Turkey, of being a "laundromat" of Russian oil.
CREA is a nonprofit think tank organization founded in Helsinki with the goal of tracking the impacts of air pollution and energy consumption.
In particular, it is also identifying fossil fuel exports from Russia and effective economic and financial countermeasures against Russia so as to help end Russia’s unprovoked attack against Ukraine.
CREA said it absolutely condemns Russia's attack as a violation of the fundamental values of human well-being, safety, and dignity.
In its report, it noted that Western countries that have largely banned the imports of oil from Russia, imported EUR 42 billion worth of oil products from the five countries that have increased imports of Russian crude oil in the past year since Russia’s invasion.
"Well into the second year of the full-scale invasion of Ukraine, the EU, most of the G7 countries, and Australia have cracked down on their imports of Russian crude oil and oil products," CREA said.
"At the same time, these countries, which are all part of the price-cap coalition whose objective is to limit Russia’s revenues from fossil fuel exports, have increased imports of refined oil products by leaps and bounds from the countries that have become the largest importers of Russian crude oil."
CREA accuses Singapore and four others of importing Russian crude and then selling oil products to those price-cap coalition countries that have sanctioned Russia. "This is a major loophole that can undermine the impact of the sanctions on Russia," CREA said.
Since Russia’s invasion of Ukraine, the price cap coalition countries have increased the imports of refined oil products from China (+3.6 million tonnes or +94%), India (+0.3 million tonnes or +2%), Turkey (+1.8 million tonnes or +43%), UAE (+2.6 million tonnes or +23%) and Singapore (+1.8 million tonnes or +33%). Price cap coalition countries’ imports of refined oil products from these five countries have risen by +10 million tonnes (+26%) or EUR 18.7 billion (+80% in value terms).
"We call these five countries that have increased purchases of Russian oil and 'launder' it into products shipped to countries having sanctioned Russian oil the 'laundromat' countries," it said.
Among the price cap coalition, the largest importer of oil products from the laundromat countries was the EU, whose imports amounted to EUR 17.7 billion. Australia purchased EUR 8.0 billion, followed by the USA (EUR 6.6 billion), the UK (EUR 5.0 billion) and Japan (EUR 4.8 billion).
In the year following the start of the invasion, seaborne imports of Russian crude oil into China, India, Turkey, UAE and Singapore increased by 140% in volume terms, compared with the 12 month period before the invasion.
The total value of their imports was EUR 74.8 billion over the twelve months, and since the EU crude oil ban until one year after the start of the war, the five "laundromat" countries have made up 70% of Russia’s crude oil exports.
As Russia is forced to offer discounted oil to ensure it is able to find buyers, the laundromat countries are refining larger volumes of imported Russian crude to, then export the refined products to sanction imposing countries.
"This is currently a legal way of exporting oil products to countries that are imposing sanctions on Russia as the product origin has been changed. This process provides funds to Putin’s war chest," CREA noted.
