"No country in the world can replace the oil of the Persian Gulf"

Alexey Gromov, Principal Director on Energy studies at the Institute for Energy and Finance, gave an interview to the Chemical Aggregates industry magazine about the current situation in the Middle East in the context of its impact on global energy markets, as well as on Russian oil production and exports.

— Does Russia have the potential to increase oil production?

— Yes, there is. Before the outbreak of the great war in the Middle East, Russia had great difficulties with oil export opportunities. In December 2025 – January 2026, shipments to India decreased by 40%. It was assumed that in the spring, supplies could decrease by another two times compared to January-February. But the war changed the situation. India is returning to the list of the main buyers of our oil, along with China and Turkey. In this regard, the situation is developing favorably for Russia.

The fundamental question is how long the closure of the Strait of Hormuz will last. If this story drags on for months, our companies receive a signal that demand for oil will be stable in the future throughout 2026, therefore, there are incentives to increase production.

— What numbers of production increases can we talk about?

— Currently, data on Russian oil production is classified, but there are data from foreign analytical agencies that recorded a decrease in production drilling in the industry back in January, based on which they said that in January production volumes were 300 thousand barrels less than last year. If companies start investing, production drilling will increase and we will be able to further increase production by 200-300 thousand barrels per day within three to six months.

On an annual basis, this will mean that oil production, at least, will remain at the level of last year. Last year we produced 512 million tons. By the end of this year, we expected that the decline in production due to export problems could amount to 5-6 million tons per year. This decline can be avoided if the Russian Federation actively uses the window of opportunity that the conflict in the Middle East has opened for it. This will happen if this conflict has lasting consequences, if the closure of the Strait of Hormuz continues and shipping does not open in the next two days.

— What is happening with the prices of Russian grades of oil and supplies?

— Now the prices of Russian oil shipments in Russian ports, FOB prices are rising along with world oil prices. But the difference between Brent and Urals remains at the same levels as previously observed. Another thing is that the sale of Russian oil to end customers today is carried out even at a premium relative to Brent.