Thread by @anders_aslund

A few thoughts on how to strangle the Russian economy.
1. Russia lives on its exports of commodities. 90% of its exports are commodities & 2/3 used to be oil and gas.
2. Commodities require cheap transportation, shipping or pipelines.

3. Russia has already lost almost all its 150 bn cubic meters of gas exports to Europe, worth $60-70 bn a year. The dominant gas pipelines go to Europe & Russia produces little LNG. Domestic gas sales remain heavily subsidized so Gazprom can go bankrupt.

4. Oil has traditionally accounted for more than half of Russia's total exports & it probably still does. The West & Ukraine should focus on minimize Russia's oil export revenues.

5. From the beginning of 2023, the West imposed a price cap on Russian oil. It worked well during the first half of 2023, but then the prices rose.
6. The US GOV has successfully traced sanctions breakers & sanctioned many of them. This is proceeding with increasing success.

7. 90% of Russia's oil exports go from two seas, the shallow Baltic Sea and the Black Sea. Most of it is now being shipped by a shadow fleet of old, substandard ships with poor or no insurance. This should not be permitted in these environmentally highly sensitive waters.

8. The Baltic Sea is surrounded by NATO members that care about the environment. They must prohibit the dangerous shadow oil tankers from the Baltic Sea.
9. This could be done in two choke points, the narrow and shallow Öresund or the Gulf of Finland (Finland & Estonia).

10. All Russian oil exports from the Black Sea has to pass through Istanbul through the narrow Bosphorus. How can Turkey, which imposes sound environmental restrictions on the Bosphorus, allow any substandard oil tankers to pass through? High time to stop them all!

11. Ukraine has now started the next step by bombing the refineries & export ports, which are highly concentrated around two cities, St. Petersburg & Novorossiisk. By insisting on being independent from transit countries - & maltreat them - Russia has made itself vulnerable.

12. Ukraine has bombed one of three major oil ports around St. Petersburg & one in Tuapse near Novorossiisk. It has also bombed several oil depots.
13. Next, we would expect Ukraine to hit further refineries, depots & export ports in these areas.

14. After that, Ukraine can proceed upstream and bomb important oil facilities & junctures, which are not as easily repaired as pipelines.
15. In parallel, the West should prohibit Western oil service companies to work in Russia, notably Schlumberger that still works there fully.

16. But doesn't the world need Russian oil? Not really. The US is currently producing more oil than any country has ever done, 13.2 million barrels a day & it can easily increase production much further if the administration allows it. This is the right time to hit Russian oil.

17. Russia’s export revenues are projected to stop at $420 bn (-29% from nearly $600 bn in 2022). Since approximately half of this is oil, Russia's total exports can be slashed to $200 bn with effective oil sanctions & Ukrainian bombing.
Then, Russia is on its knees financially.

18. I should ad that an important reason why Ukraine can bomb Russian facilities so well is that Ukraine has developed outstanding drone production during the war. The drone producers are many & private. They are the best & the brightest Ukrainians (I know several).