Turkey-Russia trade is facing a payment crisis after the US threatened sanctions against financial institutions that intermediate trade with Russia, Reuters reported.
According to seven different sources, Turkey’s payments for goods from Russia have been disrupted by a December decree expanding US sanctions against Russia, seven different sources told Reuters. While the decree was aimed at making it harder for Russia to fund its occupation of Ukraine, its impact has been increasingly felt in specific sectors such as the oil trade.
Oil supply paused
Turkey’s problems have been seen before in Russia’s trade with countries such as India, the United Arab Emirates and China, the sources said. In the case of India, payment problems are known to have halted oil supplies and affected oil shipments for some time.
The complex US economic sanctions against Russia are aimed at preventing Russia, one of the world’s largest oil producers, from shipping oil to international markets. The sanctions aim to reduce Russia’s oil revenues.
“We have not received payment from Turkey for weeks”
Four sources familiar with the payment crisis over Turkish oil and petroleum products imported from Russia, speaking to Reuters on condition of anonymity, said delays were caused by Turkish banks’ close scrutiny of transactions and tighter monitoring of transactions with Russia by “compliance units”.
A source at a major Russian oil company said that they have not received payments from Turkey for the last two to three weeks, while other sources said that the delays in payments have not disrupted the flow of crude oil, but some cargoes have been delayed.
Problems on cargo basis
According to Turkish sources, especially after the new sanctions in December, it has become difficult to make some energy payments to Russia and payments have to be changed or postponed. However, it is stated that oil shipments continued during this period, but there were some problems on a cargo basis.
The US sanctions and Turkish banks’ scrupulous handling of transactions trigger these payment problems in Turkey-Russia trade. These developments point to possible impacts on Turkey’s energy imports and foreign trade balance. The Ministry of Trade and the Treasury have yet to comment on the issue.
“Ankara is trying to cope with payment problems in trade with Russia at a time when US sanctions are increasing pressure on Turkish banks,” Reuters reported.
Source: Ekonomim