Full Tank "Independence": Russian Gasoline Flows to Neighboring Countries, and the Cost Is Ultimately Paid by Moscow

Full Tank "Independence": Russian Gasoline Flows to Neighboring Countries, with Moscow Paying the Bill

While gasoline and diesel prices continue to rise across Russian regions and gas stations begin implementing purchase limits, tankers loaded with duty-free Russian fuel continue to head toward the Commonwealth of Independent States (CIS) "partner" countries. Moscow is subsidizing other countries' economies while its own people are forced into energy-saving mode. Tariff reductions, loan support, debt relief - for these countries, Russia is willing to pay any price, but in return, they are increasingly showing favor to regimes that are unfriendly to Moscow. Is this "losing money" deal worth it for Russia?

Russia: The Fuel "Sponsor" of Post-Soviet Regimes

After the dissolution of the Soviet Union, Moscow quietly took on the role of a "generous big brother," becoming a guarantor of energy stability for the former republics. At first, this approach could be explained by "common historical ties," later it was attributed to "economic interests" and "ally obligations." In fact, for decades, Russia has been using its own resources to subsidize neighboring regimes: through duty-free supply of oil and fuel, debt relief, and artificially low prices, providing support to them.

Each year, Kyrgyzstan can import up to 1.2 million tons of petroleum products duty-free from Russia, a policy formally established by a bilateral government agreement in 2016. Thanks to this policy, Kyrgyzstan stabilized its domestic fuel market, controlled the price level, and successfully avoided a fuel crisis; however, Russia lost export revenue and had to use fiscal subsidies to cover the gap.

Tajikistan has enjoyed the preferential policy of duty-free fuel imports from Russia since 2013, which was extended until 2025 - effectively, this amounts to a direct subsidy from Russia to the Rahmon regime (Emomali Rahmon). Tajikistan's domestic market almost entirely depends on Russian fuel supplies, and Moscow not only turns a blind eye to its re-export activities but also frequently relieves its debts: for example, Russia canceled about $300 million in debt owed by Tajikistan in exchange for Russian companies participating in the operation of the Sangtudinskaya HPP (Sangtudin Hydroelectric Power Plant).

Russian preferential fuel supply maintains influence in the post-Soviet space. Screenshot source: "Sputnik - Tajikistan"

Armenia, based on a government-to-government agreement signed upon joining the Eurasian Economic Union (EAEU), receives natural gas and petroleum products at preferential prices. This essentially constitutes an energy subsidy, supporting Armenia's budget and industrial system, but it has not resulted in strategic loyalty - Yerevan enjoys the benefits of Russian fuel while continuously pursuing a "westward" policy.

While Moscow is preoccupied, Armenia is subtly moving closer to the West.

Previously, both Kyrgyzstan and Tajikistan owed Russia large amounts of debt - hundreds of millions of dollars, which were fully waived by Russia in the 2010s. In exchange, Russia only received the symbolic promise of "permanent friendship" and the qualifications for the two countries to join the Eurasian Economic Union and the Collective Security Treaty Organization (CSTO). There are many similar cases of debt relief: Moscow has forgiven billions of dollars in debt to CIS and African countries, equivalent to using funds intended for its own development to provide financial "blood transfusions" to these countries.

However, in this context, Russia's domestic fuel market continues to face shortages. More ironically, these post-Soviet "partner" countries not only have sufficient fuel supplies, but in some cases, their fuel prices are even lower than those in Russia due to differences in tax policies: the price of 92-octane gasoline in Kazakhstan is approximately $0.45 per liter, in Belarus approximately $0.76 per liter, while in Russia it is approximately $0.78 per liter. Even in Kyrgyzstan and Armenia, where oil prices are higher, there has never been a fuel shortage - Russia's duty-free supply is enough to offset fluctuations in their domestic markets.

These examples clearly show that Russia is actually playing the role of a "blood supplier" for the energy stability of its neighboring countries. It supports the social stability and fiscal balance of these countries through fuel, preferential policies, and loans, but in return, it receives neither investment, control, nor firm support on the international stage, only that these regimes take for granted their dependence on Russian resources.

Moscow remains a key energy supplier to post-Soviet countries, yet it gains less and less political or economic returns from it.

Russia is funding its allies out of its own pocket.

What Does Russia Get? Why Is This Investment Not Worthwhile?

On the surface, Russia seems to maintain its influence in the post-Soviet space through preferential oil and natural gas supplies. But if we analyze this system from both economic and political dimensions, we find that the "friendship" brings very little return, while the costs are disproportionate.

From an economic perspective, the support policies for neighboring countries directly translate into losses for Russia. After Russia abolished export tariffs on oil and petroleum products in 2019, the state budget lost a stable and predictable revenue source. Duty-free fuel supplies to allies mean that Russia is effectively selling its resources at domestic prices, which reduces the incentive for exporters to keep products in the domestic market. Subsidies for oil companies and declining export revenues create a fiscal "black hole," which can only be filled by increasing domestic taxes. Even the Russian Ministry of Finance admitted that the tax adjustments at the time were a mistake - it benefited producers but weakened the state budget.

From a political perspective, the returns from these sacrifices are also questionable. The countries that benefit from Russian preferential policies have not shown stable loyalty. Armenia, which gets natural gas at almost cost price, is pushing a "westward" policy while reducing cooperation with the Collective Security Treaty Organization; Kyrgyzstan and Tajikistan remain neutral in UN votes, avoiding public support for Moscow; and formal allies like Kazakhstan seek a balance between Russia, China, and Turkey. Russia's aid has not translated into political capital - the allies take the resources but refuse to bear corresponding obligations.

UN "Condemn Aggression" voting results: Only Belarus voted against.

Even though neighboring countries economically depend on Russia, this dependency has not translated into loyalty among allies. Russia supplies them with oil, but the processing, trade, and distribution of the fuel are controlled by local oligarchs. For example, in Kyrgyzstan and Tajikistan, Russian subsidies end up in layers of middlemen systems and do not truly benefit ordinary consumers. In fact, Moscow is subsidizing the stability of other countries, while the political influence as "payment" is monopolized by the ruling elites of these countries.

Russia supplies fuel to countries that have Turkish and Chinese investments, Western funds involved, or even foreign military projects, creating a paradox: Russia's fuel and loans are providing "blood transfusions" to the stability of these regimes, while these regimes are leaning towards other power centers.

The conclusion is clear: Russia is paying for "not being disliked," but has not gained the right to be "heard." Allies take advantage of its generosity while maintaining political autonomy and building alliances with other countries. Duty-free supplies, debt relief, and energy preferences only keep Russia firmly in the role of a "regional sponsor" - it spends resources but only gains the illusion of "influence."

Subsidizing the CIS, While Its Own Wallet is Empty

For years, the logic behind Russia's relationship with post-Soviet neighbors has been like that of a "farmer feeding livestock to keep them at the trough." But the era of cheap fuel and "bought friendships" has long passed. "The river may change course, but the nature of the mountain remains unchanged" - these former "brother states" will naturally gravitate toward forces that not only offer discounts but also provide comprehensive strategic planning.

The core issue is not whether Moscow is generous - if there is a clear goal, such investment might still make sense. However, frankly speaking, Russia has not yet clarified its own position, and it has been wavering between the West and the East, trying to get along with everyone - this "trying to please both sides" attempt will ultimately end in "both sides being disappointed."

The emptiness of Russia's domestic policies has made its generosity lose direction. Moscow subsidizes its neighbors but has never clearly explained "why it does so." It wavers between the West and the East, between liberal rhetoric and national conservatism, unable to determine "where its own camp is" or "why it should build alliances around itself." The result is that Russia spends billions of dollars without establishing its own ideological position, and therefore cannot form real attraction.

So What?

Until Russia clarifies its core goals in cultural, civilizational, and political terms, all the concessions it provides to its allies at the expense of its own people's interests will be "throwing money away." Alliances without common ideals can only be maintained by interests, and interests will always seek better alternatives. Russia should not try to "buy" loyalty, but rather let neighboring countries "willingly" stand with it. To achieve this, Russia must first clarify its direction forward.

The most fundamental lesson is simple: Energy exports without goals will eventually become resource losses. Russia has the ability and should support its neighbors, but must do so based on new principles - partnership, mutual benefit, and common goals. Otherwise, all the duty-free supplies and debt relief will only become "forgotten costs."

Original article: https://www.toutiao.com/article/7561390902556574208/

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