HomeMediaLatest NewsWhat awaits next year for the Russian oil exports

What awaits next year for the Russian oil exports

24 August 2022

Salikhov Marcel R. President, Principal Director on Economic Studies, Head of the Economic Department

Marcel Salikhov, President of the Institute for Energy and Finance, commented to Moskovskaya Gazeta about oil exports from Russia.

Saudi Arabia's energy minister said the oil market is in a state of schizophrenia, Kommersant writes. According to the minister, the "paper and physical markets" of oil are becoming more and more isolated, while in a situation of economic uncertainty in the world, transparency and clarity in the functioning of markets are necessary.

In general, according to Marcel Salikhov, the head of the Ministry of Energy of Saudi Arabia indicates that the agreement between the countries of the OPEC + community remains and will be extended, and, in principle, the Saudis are ready to reduce oil production if necessary in order to equalize prices.

“But such statements are just verbal interventions in support of oil prices,” the Moskovskaya interlocutor believes. “If we assume that next year there will be a recession in the largest economies, demand will decrease and prices will also decrease. It is logical that then OPEC + will cut production. Now the quota that is set for the OPEC+ member countries is very conditional. In fact, countries produce less than recommended by the quota. When the rate rises, but the real production is still below the quota. It doesn't really affect the market. So far, only Saudi Arabia and the United Arab Emirates have the opportunity to increase production. At the last meeting of OPEC +, it was decided to increase oil production quotas in September by 100,000 barrels per day. But it's basically nothing."

There is another forecast for the end of 2022 - the beginning of 2023, Marcel Salikhov shared his thoughts with Moskovskaya Gazeta.

“The US, Canada and the UK have already imposed an embargo on Russian oil. The European Union intends to take these measures from the end of this - the beginning of the next year. Now this situation paradoxically supports us: the EU countries, knowing that an embargo will soon be introduced, are trying to stock up, so the supply of Russian oil has increased. But next year the situation may not be very good for everyone: and Europe will have to rebuild the logistics of supplies, abandoning Russian oil, and Russia will have to turn to the Asian market. If all decisions on the embargo are maintained, the countries will not take steps towards each other, next year some kind of chaos will not be ruled out. Oil exports from Russia in 2023 may decline quite significantly. This year it has decreased by 1%. According to some forecasts, next year it will decrease by at least 5%. Less oil is exported - less export earnings go to the budget, the economy is getting poorer,” the expert explained.

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