More money to Moscow than Kyiv: Australia buying billions in fuel using Russian crude despite sanctions against Kremlin

Sky News AU

a day ago

Australia's dependence on imported oil—much of it refined from Russian crude—has handed the Kremlin billions of dollars in tax revenue from exporters, according to new research.
While Australia has proudly pledged $1.5 billion in aid to support Ukraine against Russia's invasion, a new report found the country has funnelled even more money to the Kremlin.
Data from the Europe-based Centre for Research on Energy and Clean Air (CREA) estimated Australia has imported more than AU$3.7 billion worth of oil products derived from Russian crude.
The oil is refined overseas—including at the Jamnagar Refinery in India, which has not sanctioned Russian crude—before being legally imported into the Australian market.
This would have handed Russian President Vladimir Putin about AU$1.8 billion in tax revenue, according CREA.
CREA's EU Russia Analyst Vaibhav Raghunandan called it 'a significant failing of Western sanctions', exposing a glaring loophole that lets Russia bypass restrictions.
'Refineries in non-sanctioning countries buying Russian oil are… taking comfort in the knowledge that they will face no action from Western countries,' he said.
Mr Raghunandan said countries like Australia 'look away and continue to import refined products', indirectly funding Russia's invasion of Ukraine.
The Australian Strategic Policy Institute (ASPI) warned this 'policy blind spot' was 'actively undermining our credibility' as a nation.
ASPI's Director of National Security Programs John Coyne called Australia's dependence on Russian-linked fuel 'a serious national security failure and a strategic contradiction'.
'We cannot claim to support Ukraine and uphold a values-based foreign policy while simultaneously fuelling our economy with Russian-linked petroleum,' he told Sky News.
'According to reports, Australia has sent more tax dollars to the Kremlin through these imports than we've provided to Ukraine in aid. That's indefensible.'
Resources Minister Madeleine King did not respond to questions asked by Sky News about the issue.
Due to fuel security issues, Australia has continued to rely on imports in order to deliver its national energy demands.
According to the latest Australian Petroleum Statistics, there are just 56 days of fuel supply on shore, well below the International Energy Agency's 90-day requirement.
Mr Coyne said Australia's critically low domestic fuel reserves was a vulnerability.
'Our domestic fuel reserves remain critically low… Australia is dangerously exposed to global supply disruptions, conflict, or coercion,' he said.
'We are one maritime chokepoint or geopolitical flare-up away from a fuel crisis.'
Mr Coyne urged the federal government to take immediate action to bolster sovereign energy capability and national resilience.
'The era of cheap energy and blind reliance on market forces to solve national problems is over. Governments can no longer outsource resilience,' he said.
'Right now, Australia is precariously vulnerable to any disruption in the global liquid fuel supply chain and that vulnerability cuts across defence, emergency response, agriculture, and logistics.'
He said to address the problem, the Albanese government must close the refining loophole in its sanctions regime and improve sovereign refining and storage capacity.
He added the government needed to 'embed fuel security in a coordinated, whole-of-government resilience strategy'.
'This is not just about economics. It's about whether Australia can function, respond and defend itself under stress,' Mr Coyne said.