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Russia's coal crisis: Companies are closing, jobs are at risk!
Western sanctions are weighing heavily on the Russian coal industry. Forecasts show a long-term decline in exports.
Russia's coal crisis: Companies are closing, jobs are at risk!
Western sanctions are having a significant impact on the Russian economy, particularly on the coal sector. According to a report by Mercury Russia's coal industry is facing a "serious crisis" that is mainly felt in the Kemerovo Oblast. This region produces around 60% of Russia's hard coal and around 80% of its coking coal.
Eight coal companies have already ceased operations and many miners have been waiting for their wages for months. The problems in the coal industry are due to falling prices, logistical difficulties, staff shortages, high inflation and Western sanctions. It is reported that Russia tried to compensate for the decline in coal consumption in Europe by exporting it to Asia, but this attempt was not successful as demand in China also fell at the end of January.
Falling revenue in the future
The EU imposed an import ban on Russian coal in April 2022, which affected 25% of Russian coal exports and meant annual revenue losses of around 8 billion euros for Russia. Forecasts point to a long-term decline in Russian coal exports, while Germany now sources most of its coal from Australia. Newer US sanctions aim to further reduce Russia's profits from energy exports, while key trading partners distance themselves and some payments are blocked.
At the same time, the EU added 27 more Russian liquefied natural gas ships to the sanctions list at the end of June, and England imposed similar measures against ships that export Russian oil bypassing sanctions South German newspaper reported. Despite these measures, Russia has earned around 707 billion euros from oil, gas and coal since the attack on Ukraine in February 2022.
The country's income from military spending, which is expected to rise to 100 billion euros in 2024, remains unaffected by the sanctions. Imports of Russian crude oil and liquid gas into the EU also increased by over 25% in the first half of 2024. Experts are calling for sanctions and measures to control seafarers to be tightened.