When the Trump administration slapped sanctions on Iran in November, European oil refiners turned to Venezuelan sour crude oil as a replacement — and after Trump announced sanctions on Venezuela to pressure President Nicolas Maduro out of office, "European refiners have been left competing to secure as much medium, sour Russian Urals as they can," Reuters reports. Trump's sanctions have removed at least 800,000 barrels a day from the market, and with OPEC simultaneously slashing the supply of sour crude oil, Russia is cashing in.
The U.S. is producing more oil than ever, but it is mostly light, sweet crude, so "it is not an alternative" for Europe, Reuters says. "Thanks to the higher premiums, Russia made an additional $140 million in March from seaborne and pipeline deliveries versus October prior to the sanctions coming into effect."