Alexey Gromov, Principal Director on Energy Studies of the Institute for Energy and Finance, commented to Gazeta.ru on the prospects for a global transformation of the world oil market due to the threat of an embargo on Russian oil supplies by the EU.
Saudi Aramco's decision to increase export commodity prices is quite logical, Alexey Gromov emphasized in a conversation with Gazeta.Ru. The fact is that the world is now experiencing an acute shortage of “light” oil, which includes Saudi brands and Russian Urals.
“The maximum that the EU can do in the framework of the fifth package of sanctions is a ban on the delivery of crude oil by sea tankers. Saudi Arabia could easily replace them, but at higher prices. Pipeline deliveries through Druzhba, tied to delivery to specific refineries, are unlikely to be affected by the Europeans. It will be extremely problematic to cut off such a transit,” Gromov said.
“Due to the growing shortage of crude in the medium term, there is likely to be a global redistribution of oil flows. Russian oil will go to India, China and other Asian countries with a small discount, while more expensive Saudi crude will go to the USA and Europe,” Gromov concluded.
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