Russia and Vietnam have found a clever way to buy and sell military equipment without using regular international banks. Documents obtained by journalists show that the two countries are using money from joint oil and gas projects to pay for fighter jets, tanks, and ships. This method is designed to avoid American and Western sanctions, keeping cash moving quietly between the two nations.
How the System Works
Vietnam has bought Russian military gear on credit. Instead of paying Russia directly with money from banks, Vietnam uses profits from a joint oil company in Siberia called Rusvietpetro. These profits go to Russia to pay off the military loans.
After that, extra profits are sent to a Russian state-owned oil company called Zarubezhneft. Then, through a joint venture in Vietnam, the money is effectively returned to the local partner. This keeps the payments circulating between Russia and its partner nation and avoids the global banking system, including SWIFT, which is heavily monitored by the United States and other Western countries.
Experts say this is not a typical loan or trade arrangement. It is a carefully designed system to hide money movements and reduce the risk of sanctions. By using profits from energy projects rather than regular bank transfers, both countries are able to make payments quietly. This means Vietnam can continue buying Russian weapons while staying under the radar of U.S. rules.
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Why This Matters
The system comes at a sensitive time. The United States, under President Donald Trump, is trying to strengthen its ties with Vietnam to counter growing Chinese influence in Southeast Asia. At the same time, the U.S. has imposed tariffs and sanctions on countries that buy Russian weapons or energy.
Using energy profits to pay for arms allows Vietnam to maintain military deals with Russia without openly violating U.S. rules. Russia also benefits because it receives payments for military exports without going through banks that might block the transfers.
Vietnam has a strong military in Southeast Asia and continues to upgrade its naval and air power. The country has a long-standing defense relationship with Russia, relying on Russian spare parts and technology. Military deals with Russia have included fighter jets, tanks, and naval ships, with large portions still delivered on credit. At the same time, the U.S. is a key trade partner and has lifted an arms embargo, allowing access to American weapons as well.
This dual approach shows how Vietnam is balancing its military needs with global diplomacy. The arrangement also highlights how countries can use energy profits and joint business ventures to bypass international financial restrictions. Analysts have described the process as highly unusual, calling it a sophisticated method that connects energy revenue directly to military payments.
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The Details of the Backdoor Payments
Internal documents show that the process is precise. Vietnam’s oil profits first pay off military loans in Russia. Extra profits go to Zarubezhneft in Russia, and then the same amount is sent back to Vietnam via a joint venture.
By keeping all transactions inside Vietnam and Russia, both countries avoid international scrutiny. Officials say this arrangement is designed to prevent Vietnam from being affected by U.S. sanctions while ensuring that Russia receives consistent payments for its weapons.
The system has been officially implemented, and recent agreements between Vietnam and Russia show that it continues to operate. Oil and gas projects in Siberia and in Vietnam’s territorial waters are part of this network, allowing both countries to move money without relying on the global banking system.
Diplomats and analysts describe the arrangement as highly unusual and secretive. It demonstrates how energy profits can be directly tied to military payments, creating a loop that keeps money circulating between the two nations while avoiding international oversight.
