Crude Oil, Sanctions, Unpopular Reality & Energy Markets

Energy Sector Weekly Recap — July 12–18, 2025

This week, the energy market once again highlighted the growing divide between perception and physical reality. While media and policymakers push headlines about tightening supply, Russian oil “crippling,” and price cap effectiveness, the hard truth moves quietly at sea.

This is a market trading between fiction and friction.

EU officials trumpet their latest “tough stance” on Russian crude, lining up for press hits and policy praise—meanwhile, Russian oil flows quietly continue via grey-market routes. In the background, their colleagues clap along like trained seals—ironically, much like the ones just passed by a Russian tanker off the books.

📉 Price Action Summary

The mid-June run-up in oil and refined product prices has now completely stalled. Volatility is gone. Volume is thinning. And despite a fresh wave of sanctions and bullish headlines, the tape isn’t buying it.

The Disconnect: Narrative vs Tanker Traffic

This week’s headlines painted a dramatic picture:

• “EU Imposes More Sanctions on Russian Oil”
• “Crude Prices Climb on Export Disruptions”
• “Iraq May Boost Output After Pipeline Agreement”

And yet, the Bloom Commodity Index remains flat at 105.10, and oil futures continue to consolidate sideways—unchanged since the June 24th peak.

Why? Because the narrative is simply not accurate, as they may want you to believe

There are no significant dwell time increases. No major port congestion. No backup at chokepoints like the Strait of Hormuz or Bab el-Mandeb. If physical oil were scarce, we’d see ships piling up. They’re not.

Global Oil Flows: Hard Numbers Tell a Different Story

Crude oil logistics continue to evolve, not collapse. Let’s look at maritime shipping data:

🔻 U.S. Oil Exports:

• Down 8.8% year-over-year to 60.9 million metric tons
• Reflects fading demand from traditional buyers, especially in Europe and East Asia

🔺 Southeast Asia Imports:

• Up 9.8% to 48.5 million tons
• More volume is flowing from the Middle East and Russian suppliers, not the U.S.

Jan–Apr 2025 Import Breakdown:

China continues buying discounted Russian oil—just now via off-books VLCC shipments routed through “grey market” intermediaries. Physical flow hasn’t stopped; it’s gone opaque.

Currency Reality: The Ruble Isn’t Collapsing

Despite over two years of aggressive sanctions, oil embargoes, and financial isolation, the Russian ruble has not collapsed—a fact rarely acknowledged in mainstream Western media.

The ruble today is stronger than it was during the peak of sanctions panic, and nearly identical to its 2021 levels. It has gained 7 rubles vs the dollar in the last 12 months.

Conclusion? If sanctions were working, you’d see a destroyed currency. Instead, you’re seeing stabilization—and in some contexts, appreciation.

Tanker Reality: Flows over Forecasts

• ~85% of China’s 2024 oil came in via VLCCs
• No reported disruptions at major ports
• No spike in shipping insurance, no reroutes due to danger zones

If sanctions were working, you’d see traffic jams at Russian terminals and empty berths in Asia. You’re not.

💹 Sentiment + Fund Positioning

Money managers continue reducing long exposure after the June rally, particularly in gasoline and ULSD. Open interest in crude is flat, while refined products show declining volume—suggesting a return to seasonal norms, not a tightening crisis.

Final Word: Trade the Tankers, Not the Take

The real movement this week wasn’t in prices—it was in positioning. Narratives about Russia’s oil industry “breaking” or supply “tightening” continue to circulate. But the physical oil is flowing. Russia’s rerouted volumes, China’s strategic restocking, and India’s rising demand continue to shift global flows eastward.

The lesson? Don’t trade headlines. Trade tanker traffic. Because the barrels don’t lie—and neither does the ruble.