Taliban nearing deal to buy Russian oil, benefiting Putin’s economy

Taliban officials and Moscow are finalizing a deal that will allow Afghanistan’s lone ruler to buy much-needed fuel while propping up Russia’s heavily sanctioned economy.

A delegation of Taliban officials is in Moscow and is negotiating with Russia to secure imports of wheat, gas and oil, Reuters reported on Monday. The talks come as the Taliban seek to lift a diplomatic freeze following last year’s military occupation of Afghanistan, and as Russia evades Western sanctions for invading Ukraine.

An unnamed source at the Afghan Commerce and Industry Minister’s office told Reuters that the deal is expected to be completed soon.

The government has not formally recognized the Taliban’s government after a hardline Islamist group seized power after the US withdrew its existence last year. keeps an embassy open in Kabul, the capital of Afghanistan. Russia, which has been plagued by tough economic sanctions since the war began in February, has also hosted talks with Taliban trade officials.

Russian Taliban representative
Muhammad Yunus Muhmand, Deputy Chairman of the Afghan Chamber of Commerce, attends the St. Petersburg International Economic Forum on June 17, 2022.
Olga Martseva/Getty Images

According to Afghanistan’s TOLOnews, Afghanistan already gets most of its food and oil from Russia, with annual trade between the two sides amounting to $200 million. Russia is already offering cheaper wheat and oil, news outlets said, citing the country’s chamber of commerce.

Oil exports have been an important economic lifeline for Russia. Despite sanctions, Russia earned about $93 billion from fossil fuel exports in her first 100 days of invading Ukraine, according to a report by the Center for Research on Energy and Clean Air.

Russia’s energy demand was primarily driven by China and India, according to the report. Additionally, Germany, Italy, the Netherlands, France and Poland have also helped keep Russia’s energy demand high despite sanctions, the report said.

“May imports fell by about 15% from pre-invasion levels as many countries and companies avoided Russian supplies,” the report said.

The center’s data showed Russia lost about $200 million a day in May due to lower oil demand and lower prices. But rising global demand for fossil fuels means that average Russian export prices remain 60% higher than last year.

However, according to the International Energy Agency’s June oil market report, the very high global energy prices that have buoyed the Kremlin’s finances could fall next year as markets adjust.

“Global oil supply will not be able to keep up with demand next year, as tougher sanctions force Russia to close more wells and many producers face capacity constraints,” the report said. may suffer,” he said.

A trade deal between Russia and the Taliban may be close, but other barriers may prevent the exchange of the two commodities.

Nooruddin Azizi, the Taliban’s deputy trade minister, told TOLOnews that most Afghan and Russian banks are under sanctions, meaning third countries make it easier to exchange funds.

“Some of our technical team is still in Russia and we want to work on the details of how the money transfers will work,” said Azizi.

Newsweek I have asked the Russian government for comment.

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