Oil prices are soaring and the attention of the United States and its military resources have shifted decisively to the Middle East.
Russian President Vladimir Putin may have lost another Kremlin-friendly leader, but war against Iran could prove a long-term boon for his country, whose economy depends on energy exports.
“So far, there is only one winner in this war: Russia,” European Council President António Costa said on Tuesday while addressing ambassadors in Brussels about the conflict in the Middle East.
“It gains new resources to finance its war against Ukraine as energy prices rise,” Costa said. “It benefits from the diversion of military capabilities that otherwise could have been sent to support Ukraine. And it benefits from less attention to the Ukrainian front as the conflict in the Middle East takes center stage.”
While oil prices have fallen since hitting a high on Sunday not seen since Russia’s invasion of Ukraine, they remained high as shipping through the Strait of Hormuz, one of the world’s busiest oil shipping channels, which borders Iran to the north and is crucial to global energy supplies, remained virtually halted.
Iran has said it would “set fire” to ships trying to pass through the narrow waterway, but little traffic has continued.
At a meeting in the Kremlin on Monday, Putin told policymakers, ministers and business heads that it was “important for Russian energy companies to take advantage of the current moment.”
He also suggested that the European Union, which has been charting a course away from dependence on Russian energy, would have to reconsider its stance toward “long-term stable cooperation” with Moscow.
The Russian media was flooded on Monday and Tuesday with headlines and analysis about how rising oil prices will affect the country, but also its adversaries in the West. “Strike in the East: Oil price could exceed $150,” read the headline in the Russian pro-government newspaper Izvestia.
Separately, firebrand pro-Kremlin TV host Olga Skabeyeva joked Tuesday that people in neighboring NATO nation Estonia were having to walk because public transportation was already running out of fuel.
After Putin’s meeting on Monday, President Donald Trump appeared to deliver him another gift by suggesting his administration was lifting sanctions on “some countries” to stabilize the oil market.
He did not elaborate on which countries could see their sanctions lifted, but his comments came shortly after a call with Putin, his first since December.
Kremlin spokesman Dmitry Peskov said Tuesday that lifting sanctions had not been discussed on the call “in any detail.”
How much Russia will benefit from the oil crisis depends on how long the conflict in the Middle East lasts, several analysts told NBC News.
If it is a matter of several weeks, the effect could be minimal, but if the conflict drags on for months, there could be a much more significant boost to the Russian economy, said Petras Katinas, a climate, energy and defense researcher at the Royal United Services Institute, a London-based think tank.
The discount at which Russia markets its oil to offset the risk of running afoul of U.S. sanctions has been narrowing since the crisis in Iran began, Katinas said in a phone interview Monday. “So the longer the prices last, the more Russia will be able to sell its crude oil on the global market at a smaller discount,” he added.
This increase in oil revenue would likely give Putin new revenue for his war effort in Ukraine, a huge expense that has been draining the Russian economy, according to James Henderson of the Oxford Institute for Energy Studies.
“No one would be surprised if military spending increased as a result of this,” Henderson said. “There will be more money available and therefore, by default, there will be more money available to spend on the military. That is definitely an unfortunate consequence.”
It comes at a delicate time for peace negotiations to end the war in Ukraine, which appear to have stalled as the Trump administration has shifted its focus toward Iran and the Middle East.
As stocks of Ukrainian air defense missiles run out, President Volodymyr Zelenskyy said last week that every air defense missile used to protect US assets and bases in the Middle East depletes US resources that could have been available to Ukraine, in yet another victory for the Kremlin.
However, diverting Trump’s attention from Ukraine could be a double-edged sword for Russia, according to John Lough, foreign policy chief at the Center for New Eurasian Strategies, a Washington and London-based think tank that focuses on Russia.
“It has been very helpful to the Russians for Trump to corner Zelenskyy and try to extract concessions from him,” Lough said. “In many ways, Trump has been a source of support for them,” he added. “I think they have to accept that he is out of the picture for them.”
The conflict in the Middle East has also exposed Russia’s declining role in the region, Lough said.
Iran has been a strategic partner for Russia, helping to equip its military in Ukraine with drones, and Putin on Monday offered “unwavering support” to Mojtaba Khamenei, Iran’s new supreme leader and son of its former head of state, Ali Khamenei, who was assassinated. on the first day of the US-Israeli operation in Iran.
Russia has also been providing intelligence to Iran about the location of US forces in the Middle East, four sources with knowledge of the matter told NBC News on Friday, although the Kremlin has not officially said it would provide military or intelligence assistance to Iran.
“This is another humiliation for the Russians,” Lough said. “It has been shown that he is an actor who is not relevant and has no influence,” he added. “So they had to sit back and watch this, and I’m sure it’s extremely unpleasant for them.”
