'Too big to sanction'? 10 key facts about Russia's oil and commodity exports

Crude oil

Price: $124 a barrel Brent crude, $126.50 a barrel WTI crude.

Change YTD: 61.92% Brent crude, 64.55% WTI.

Russia is the world's third-biggest oil producer after the US and Saudi Arabia. It is responsible for about 12% of global oil production, or between 10 and 12 million barrels per day.

Around 60% of Russia's oil exports go to OECD Europe, and 20% to China, the largest single buyer of Russian oil.

Roughly two-thirds of the country's exports are seaborne, with the rest being shipped via vast pipelines. 

"Commodity prices continue to rise generally, and talk of cutting off Russian oil supplies would likely mean further rises," IG analysts said in a note.

Natural gas

Price: $5.07 per million British thermal units (mmBtu)

Change YTD: 35.8%

Russia supplies almost half of the European Union's gas.

In 2021, the EU imported 155 billion cubic metres of natural gas from Russia, accounting for around 45% of EU gas imports and close to 40% of its total gas consumption. 

Germany is heavily reliant on Russian gas, and imports 35% of its gas from there. It had intended to secure even more Russian gas through the Nord Stream 2 pipeline, but that project has been put on hold indefinitely in light of the war in Ukraine.

Gold

Price: $2,001.70 a troy ounce

Change YTD: 9.38%

Russia is the world's third-largest producer of gold after Australia and China. It supplied about 350 tonnes of the precious metal last year, according to data from the World Gold Council.

"Historical analysis suggests that gold has reacted positively to tail events linked to geopolitics and, despite price volatility , tended to keep those gains in the months following the initial event," Juan Carlos Artigas, global head of research at the World Gold Council, said.

The gold price has benefited more from an influx of capital from investors that are seeking a safe haven in times of market uncertainty, rather than from anyone concerned about disruption from Russian physical supply.

Coal

Price: $418.75 per ton

Change YTD: 146.90%

Russia is the world's third-largest coal producer. China is Russia's largest coal buyer, buying over 50 million tons of coal last year, according to Reuters.

"Having to replace Russian coal volumes would result in a price shock to global coal markets and a coal shortage in Europe. Russian coal accounts for roughly 30% of European metallurgical coal imports and over 60% of European thermal coal imports," energy consultancy Wood Mackenzie said.

The primary issue with replacing Russian coal exports in Europe is its reliance on Russia's particular quality of coal," the WoodMac analysts said.

Wheat

Price: $1,294.12 per bushel

Change YTD: 68%

Russia produced 75.5 tons of wheat last year, and it is the largest wheat-exporting country, with almost 17% of global export supply, according to ING.

"Looking further ahead, if Russian commodities continue to be self-sanctioned, we could start to see farmers reacting by reducing area," ING analysts said.

"For winter wheat, it would be too late, however for spring wheat and corn, there is the potential that the ongoing uncertainty leads to reduced plantings," they added.

Nickel

Price: $41,341.50 per ton

Change YTD: 99.29%

Russia accounts for around 7% of global nickel output and is the third biggest producer behind Indonesia and the Philippines. Nickel is a key component in the production of stainless steel and batteries for electric vehicles. 

"Disconnecting Russia from the prevailing western financial system might result in potential disruptions to exports of Russian commodities, including nickel and cobalt. However, given that Russian nickel is mostly used in the steel industry, it is estimated that a direct impact on the battery supply chain will be limited," Rystad Energy said last week in a note.

Palladium

Price: $3,180 an ounce

Change YTD: 75.13%

Russia vyes with South Africa for the position as the world's largest producer of palladium. Any kind of disruption could pose a serious problem for auto manufacturers, as the metal is used in the production of catalytic converters to reduce emissions.

"Possible supply outages from Russia are still being priced in on the palladium market. Russia accounts for 38% of global palladium production. As supply outages could not be offset elsewhere, the market risks sliding into a sizeable supply deficit," Commerzbank strategist Daniel Briesemann said.

Copper

Price: $10,721.50 an ounce

Change YTD: 10.41%

Russia supplies about 3.5% of global copper, which is used in wiring and power cables.

Supply disruptions from Russia, as well as European smelters faced with punitively high energy prices cutting back production, are exacerbating acute supply constraints, according to Saxo Bank analysts.

"Russia is one of the world's largest copper producers, and while the price for months has been held back due worries about Chinese demand, the focus is now turning towards a sanctions-led further tightness in supply, and with that the prospect of new record being reached sooner rather than later," they said.

Lumber

Price: $1,452 per thousand board feet.

Change YTD: 25.53%

Russia is the largest lumber exporter in the world, and its forest-product exports were worth more than $12 billion last year, according to trade journal Canadian Forest Industries, which cited data from Wood Resource Quarterly.

De-escalation in the Russia-Ukraine war may not offer much price relief either as several factors have been applying upward pressure. The US housing shortage and a continuing focus on home improvement are keeping demand high.

Aluminum

Price: $4,027 a ton

Change YTD: 43.72%

Russia is the world's biggest aluminum producer behind China. It accounts for around 6% of global supplies, estimated by analysts to be 70 million tons this year. Aluminum is one of the most energy-intensive materials and the surge in oil, natural gas and coal has fed into a comparable rise in the cost of the metal.

"Energy accounts for about 40% of the production cost. Mostly by coal. So when coal prices moves so does aluminum. The price of coal in Australia and Europe has now exploded to roughly $450 a ton versus normal of $80 a ton. If that is maintained over longer period then aluminium needs to move to $6,000 a ton in order to cover the energy cost," strategists at SEB said.