Management of sanction mechanisms introduced by G7 countries on Russian precious metals flow in the context of the war in Ukraine – July – December 2022

Abstract

This article is a complementary continuation of “Management of sanction mechanisms introduced by G7 countries on Russian precious metals flow in the context of the war in Ukraine – February – June 2022”.

The analysis begins with a discussion of the impact of the seventh package of sanctions, which effectively blocked import opportunities for Russian gold and imposed heavy import duties on other precious and industrial metals.

The analysis then considers the London Metal Exchange, which is unable to completely abandon deliveries of Russian metals. The author focuses on industrial metals, as they better exemplify problematic issues occurring on LME, but these issues also relate to palladium and platinum.

Further two chapters focus mainly on Russia. Paper focuses on evolution of gold reserves at Central Bank of Russia, condition and troubles of Russian mining sector and ways and means how Russia attempts to use its gold and gold/blockchain based products to circumvent blockades on SWIFT.

Paper concludes, that sanctions on Russian precious metals are largely countered and circumvented by Russia.