London Daily

Focus on the big picture.
Saturday, Sep 12, 2026

Will a Russian diamond ban be effective?

Will a Russian diamond ban be effective?

The UK has announced a ban on Russian diamonds as it tightens sanctions over Russia's war in Ukraine.

Countries in the G7 bloc also want to be able to trace the gemstones to block Russian exports as they try to limit cash flowing into Russia's war chest.

But how effective will these schemes be, and could there be unintended consequences?


How important are Russian diamond exports?


Russia's diamond trade, worth about $4bn (£3.2bn) per year, makes up a small proportion of its overall exports.

Before the invasion of Ukraine, Russia's total exports reached $489.8bn in 2021, according to the central bank, with oil and gas making up $240.7bn of that.

Nevertheless, Russia is the world's biggest diamond exporter by volume, followed by African countries.

A state-owned company called Alrosa dominates Russian diamond mining - and it mined almost a third of the world's diamonds in 2021.

Profits from Alrosa do flow into the Kremlin war chest, according to Hans Merket, a researcher with the International Peace Information Service - but it is nowhere near as important as oil and gas.



Why does the G7 want to track Russian diamonds?


Western countries want to cut off this revenue stream as part of efforts to hamper Russia's war.

However, the world's diamond trade is complex, and lacks transparency.

Diamonds can change hands 20 to 30 times between mine and market, Mr Merket said.

Typically the gemstones pass through the main global hubs of Antwerp, Dubai, Mumbai and Ramat Gan, which is near Tel Aviv.

Traders grade the stones for carat (weight), colour, clarity and cut - with different traders looking for different attributes.

They then take the remaining gemstones, mix them up, and sell them on - and the process is repeated.

Traders and firms jealously guard where they source their diamonds - it's their "secret sauce", according to Tobias Kormind, managing director of online jeweller 77 Diamonds.

But the major industry players could restrict the trade of Russian diamonds if they pulled together, he said.


How could the flow of Russian diamonds be restricted?


The US has already brought in sanctions to try to ban Russian diamond exports.

However, there is a "massive loophole" here, Mr Kormind said.

The restrictions apply to rough diamonds - but once they have been cut and polished, the country of origin no longer matters.

People in G7 countries buy about 70% of the world's diamonds - so a G7 ban could have an effect, if the diamonds can be traced, Mr Merket said.

However, a G7 ban would mean diamonds are likely to flow to other markets in China and India, Mr Kormind said.

Tracing the diamonds would make restricting that flow easier.


How could diamonds be traced?


There is already a scheme to try to restrict "blood diamonds" used to fuel conflict, called the Kimberley Process, where states certify that diamonds are "conflict free".

However, this does not allow the diamonds to be traced to the country of origin.

Mr Merket said the simplest way of tracing diamonds would be to extend this process to include documentation of where the stones come from.

There are also technologies that mark stones, and one is being developed that can scan them to check their geographical origin.


What effects would a ban have?


The majority of Russian diamonds end up in India, where there is a major cutting and polishing centre in Surat.

Smaller diamond businesses in the city have already suffered, in part due to the US ban.

In Africa, local mining operations benefitted after US sanctions hit Russian exports. However, many African mining producers are not ready to feed into a traceability scheme, Mr Merket said, and could be excluded if one is brought in.

In Angola, Russia's Alrosa has a significant stake in mining, and tightening sanctions could hit local firms.

For Europe, traceability needs to be "watertight, scientific, [and] international", said Tom Neys, head of media relations at the Antwerp World Diamond Centre.

If not, Europe risks losing $40bn in trade annually to places that don't have the frameworks to deal with money laundering and terrorism, he said.

He added that UK sanctions "will have no impact on the sale of Russian diamonds" because the UK represents less than 1% of the global diamond trade.

A UK government spokesperson said it would work with key partners to help restrict the Russian diamond trade, "including through tracing technologies".

Newsletter

Related Articles

0:00
0:00
Close
UK Reviews Nationwide Emergency Alert Tests After Systems Meet Reliability Targets
UK Seeks Faster Rail Links Across Northern Industrial Corridors
British Business Bank Allocates £150 Million for High-Growth Companies in Northern England
BBC Warns Staff Strikes Are Possible Amid Pay Dispute and £500 Million Savings Drive
UK Backs Short Extension of UN Sudan Sanctions Regime
Prime Minister Andy Burnham Defends Early Prison Release Reforms and Growth Strategy
Reform UK Faces Scrutiny Over Alleged Effort to Circumvent Foreign Donation Rules
UK Analysts Warn Tax Rises or Spending Cuts May Be Needed to Preserve Fiscal Headroom
Jaguar Land Rover Plans Up to 4,000 Job Cuts in £1.7 Billion Cost-Saving Drive
UK Chancellor Warns of Difficult October Budget as Borrowing Costs Rise
UK Declares Israeli Occupation of West Bank Unlawful and Expands Sanctions
UK House of Commons Rejects Assisted Dying Bill for England and Wales
English Councils to Gain Power to Introduce Tourist Taxes by 2028
Kemi Badenoch Reshuffles Conservative Shadow Cabinet
Firefighters Make Progress Containing Major Wildfires in South Wales
John Lewis Partnership Reports £124 Million Loss
Study Says UK AI Data Centres Will Create Only a Quarter of Forecast Jobs
UK Government Considers Higher Industrial Water Prices Amid Supply Pressures
Andy Burnham Holds First Call With Donald Trump as UK Prime Minister
NHS Records Busiest Summer on Record as Heatwaves Drive Hospital Admissions
Home Secretary Orders Police Crackdown on Far-Right Anti-Migrant Vigilantes
UK Supreme Court Rules Northern Ireland Religious Education Curriculum Breaches Human Rights Standards
Markets Price in Four Bank of England Rate Rises by Next Summer
House of Commons Prepares Free Vote on Assisted Dying Bill
UK Government Bans Trade With Israeli Settlements in Occupied Territories
UK Economy Grows 0.4% in July as Artificial Intelligence Investment Supports Expansion
Andy Burnham Becomes UK Prime Minister After Keir Starmer Resigns
John Lewis Partnership Loss Widens to £124 Million
UK Government to Put White Working-Class Social Mobility at Centre of Equality Policy
McLaren Plans £450 Million Technology Investment Creating 1,000 UK Jobs
UK Chancellor Faces Calls for Wealth Taxes and Public Ownership in Autumn Budget
English Mayors to Gain Powers to Impose Uncapped Overnight Tourist Taxes
JPMorgan’s Jamie Dimon Warns UK Government Against Bank Windfall Taxes
UK Air Traffic Control Outage Cancels More Than 2,000 Flights
UK Imposes Trade Ban on Israeli Settlements in the West Bank
UK Borrowing Costs Surge as Middle East Tensions Push Long-Term Gilt Yields to Highest Since 1998
Buckingham Palace Says Prince Harry and Meghan Will Not Resume Official Royal Duties
UK Treasury Faces Calls to Scrap £100,000 Childcare Support Threshold
Trades Union Congress Urges Labour Government to Rewrite Migration Policy
Riot Police Deployed After Anti-Migrant Protests Turn Violent in Portsmouth
UK Considers Replacing Some Disability Cash Payments With Direct Services
JPMorgan’s Jamie Dimon Warns UK Chancellor Against Higher Banking Taxes
UK Announces New Sanctions Targeting Israeli Settlements in West Bank
Metropolitan Police Investigate Alleged Illegal Donations to Reform UK
UK Charges Wiltshire Man With Assisting Russian Intelligence
UK Orders Urgent Review After Air Traffic Failure Cancels More Than 2,000 Flights
Merz Rebukes AfD Expansion in Saxony-Anhalt
King Charles Confirms Prince Harry and Meghan Will Remain Private Citizens
Labour Selects Former Child Refugee for By-Election in Keir Starmer’s Former Seat
Foreign Private Equity Accelerates Takeovers of London-Listed Industrial Companies
×