According to data from the Office for National Statistics (ONS), the UK imported £206 million of goods from Russia in May, a figure down 16% from the £244 million imported in April and 90% lower than in February.
The sanctions also saw crude oil imports hit £0 in May from $59 million in April and £99 million in February.
Following Russia’s unprovoked invasion of Ukraine in late February, Europe, the US, and other nations have imposed a series of tough sanctions against Moscow and this has severely impacted the Russian economy.
However, many European countries are still struggling to boycott Russian fossil fuels, particularly gas, as this makes up a major proportion of the energy supply for many.
Back in March, German economic and energy minister Robert Habeck warned, “If we flip a switch immediately, there will be supply shortages, even supply stops in Germany.”
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Global companies have begun to reroute cargo shipments away from the Suez Canal as analysts estimate that the blockage caused by the grounded cargo ship Ever Given may take weeks to clear.
Seven tankers transporting liquefied natural gas were diverted on Friday, the fourth day of the crisis. At least three were diverted towards the longer route around Africa via the Cape of Good Hope, according to Kipler analyst Rebecca Chia.
"A total of 16 LNG vessels’ planned transit via the Suez Canal will be affected if the congestion persists until the end of this week,” Chia said, adding that there will be considerable delays in the loading schedule at Ras Laffan from the beginning of April due to this congestion.
The 400-metre Ever Given ship has been stuck in the Suez since Tuesday morning after losing power and running aground, blocking the width of the canal. Dutch and Japanese engineering teams began to seek a way to dislodge the ship on Thursday, and Egypt has suspended all navigation within the canal.
The backlog caused by the blockage has sparked fears of piracy in the unstable regions surrounding the canal as ships are forced to remain static. Lloyd’s List tracking data shows more than 160 vessels paused at either end of the canal, including 41 bulk carriers and 24 crude tankers.
The Suez Canal, an artificial sea-level channel in Egypt that connects the Mediterranean Sea to the Red Sea, is one of the world’s busiest waterways.
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Its blockage will have an extreme negative impact on global trade. Approximately 13% of the world’s trade passes through the Suez Canal – an average of $9.6 billion per day, according to shipping data.
UK exports of goods to the European Union (EU) fell by a record margin at the start of the year as Brexit came into effect.
Exports to the EU fell by 40.7% in the first month since leaving the EU, the equivalent to a £5.6 billion loss in trade, the Office for National Statistics (ONS) revealed in figures released on Friday.
Imports from the EU also suffered, falling 28.8%, or £6.6 billion. The losses seen in both EU exports and imports represent the greatest monthly falls seen since records began in 1997.
The slump occurred as Brexit took effect on 1 January 2021, marking the UK’s official exit from the single market and the implementation of new trading rules and customs checks. It also coincided with the UK’s third national lockdown amid accelerating COVID-19 cases, further exacerbating the trade slowdown.
Exports of food and live animals – particularly seafood and fish – were the hardest-hit by the disruption, plunging 63.6% in January. However, the sector counts for only 7% of total UK exports. Overall, global UK exports and imports fell by around a fifth at the beginning of the year.
Although the fall in exports was historic, the decline did not reach the 68% plunge that road hauliers had expected to face. January’s GDP figure also represented the UK’s largest economic contraction since the beginning of the pandemic, but did not fall as much as the 4.9% anticipated by analysts.
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The lack of a greater decline in GDP is believed by some analysts to suggest that businesses and households have adapted better to lockdown restrictions than they had prior to April 2020, when GDP fell by more than 20% as the first lockdown measures were imposed.
Today Rebecca O’Keeffe, Head of Investment at interactive investor, reports on the latest market updates, with expert insight into import/exports markets and investment.
“Equity markets are under significant pressure in early trading as the global trade war is expected to come into clearer focus this month. In Europe, various leaders face acute political pressures of their own, with Angela Merkel struggling over immigration concerns and Theresa May facing another perilous month of Brexit negotiations. Previously, investors have used significant market falls as a chance to buy the dips, however, with all these headwinds, it is difficult to view current market weakness as a buying opportunity.
“After spending weeks not fully pricing in the downside risks, as investors hoped that there would be a last-minute reprieve rather than a global trade war, investors are waking up to the potential reality of a trade war and what that means for the wider markets. Falling Chinese exports will subdue the commodity markets, individual tariffs will markedly affect sectors and their wider supply chain, and the prospect of a downward spiral is very real.
“After largely surviving the pressure during the first half of the year with markets broadly unchanged, investors may find that the second half of the year, including the unpredictable summer months, may prove even more volatile than usual, delivering some opportunities, but increasing the threats for investors.”
