Marcel Salikhov, President of the Institute for Energy and Finance, commented to the online publication Lenta.ru about the difficulties in redirecting oil flows from Europe to Asia.
There are a number of difficulties in redirecting oil flows from Europe to Asia, primarily related to logistical costs. The cost of transportation to India and China is much higher, Marcel Salikhov, an economist and president of the Institute for Energy and Finance, told Lente.ru.
The economist added that if we take the entire volume of Russian supplies of oil and oil products, then the latter account for one third, which is an extremely significant volume. In addition, despite the fact that supplies to Asia have increased, it must be remembered that they are coming at a big discount.
“The problem, first of all, is that Russia exports a large amount of oil products, and they are primarily focused on European markets, so the question now is where to redirect them,” Salikhov explained. “The Asian markets, which our oil companies are now reorienting to, are not interested in buying oil products: they have their own processing enterprises, these production facilities are in surplus, they produce more than they consume, sending everything else for export.”
Subscribe for updates
and be the first to know about new publications