As tensions between Israel and Iran threaten to destabilize the wider Middle East, oil markets are reeling with volatility — and Russia could quietly emerge as one of the biggest beneficiaries.
Though the United States has announced a ceasefire between the two adversaries, no formal agreement has been reached. Skirmishes reportedly continued into Tuesday morning, leaving markets jittery and analysts skeptical about lasting peace.
While global instability around energy flows could cause concern for most nations, for Moscow, it offers a window of opportunity — both financially and strategically.
What Triggered the Oil Shock?
Over the weekend, Iran’s parliament passed a motion to close the Strait of Hormuz, a crucial energy chokepoint through which nearly one-third of the world’s seaborne oil and gas is exported. This corridor is vital for countries like Saudi Arabia, Iraq, Kuwait, Qatar, the UAE, and Iran itself.
The move sent Brent crude futures soaring to $81.40 per barrel on Monday. But the spike was short-lived. Following former President Donald Trump’s announcement of a tentative ceasefire, prices tumbled to $67.30 — though still higher than the $66.60 mark seen prior to the escalation.
According to Goldman Sachs, if oil flows through the Strait were halved for a month, prices could briefly surge to $110 per barrel, with an average of $95 projected for Q4 2025 if disruptions continue.
Why the Strait of Hormuz Matters
Roughly 14 million barrels of oil per day, or about 20% of global supply, pass through the Strait of Hormuz. Although some Gulf countries have alternative export routes — such as Saudi Arabia’s East-West pipeline and Iraq’s Kurdistan pipelines — most lack viable options.
According to the U.S. Energy Information Administration (EIA), “Most volumes that transit the strait have no alternative means of exiting the region.”
Any major obstruction in this corridor would send shockwaves through global energy markets.
How Russia Stands to Gain
Russia, already under Western sanctions, could see significant gains if oil supplies from the Middle East are disrupted.
- Price Premiums: Tighter supply would push up oil prices globally, shrinking the discount between Russia’s Urals blend and Brent crude. In May, Urals sold for $52 per barrel, with a discount of around $6. If instability continues, analysts estimate the Urals price could rise to $75, reducing the discount to as little as $2.
- Export Advantage to Asia: Russia may also directly benefit by substituting Middle Eastern oil exports to China, India, Japan, and South Korea — the primary consumers of energy shipped through the Strait of Hormuz. In May 2025, Russia led oil exports to China with $3.88 billion, ahead of Saudi Arabia’s $2.84 billion and Iraq’s $2.69 billion, according to Chinese customs data.
- Delayed Sanctions: As Western countries focus on stabilizing the Middle East, new sanctions against Russian energy are unlikely in the near term — offering Moscow breathing room.
How Much Could Russia Earn?
With Russia exporting roughly 4.7 million barrels of oil per day, every $20 increase in the oil price could generate $2.8 billion in additional monthly revenue. Over six months, that would translate to $16.8 billion — a much-needed boost to Russia’s budget amid fiscal strain.
In May, the Russian Finance Ministry cut its energy revenue forecast for 2025 by 24%, citing expectations of prolonged low oil prices. A rise in global oil prices could help offset this and reduce the year-end budget deficit, which stood at 3.2 trillion rubles ($41 billion) last year.
The Ideal Scenario for Moscow
Analyst Alyona Nikolayeva believes Russia would benefit most from a prolonged, low-intensity conflict — one that creates sustained uncertainty in global energy markets without causing a total collapse in oil demand.
This “grey zone” of geopolitical tension creates the perfect storm for Russia to profit: high prices, steady demand, and delayed sanctions.
Analyst Pavel Ryabov added that markets may be underestimating the risk: “This might be the calm before the storm, not the start of de-escalation.”
Conclusion
While much of the world braces for the fallout from a potential Middle East conflict, Russia is watching and waiting — poised to capitalize on rising oil prices and disrupted supply chains. The longer the uncertainty lingers, the more Moscow stands to gain.
