Alexey Gromov, Principal Director on Energy Studies and Sergey Kondratiev, Deputy Head of the Economic Department of the Institute for Energy and Finance, commented to Gazeta.ru on the possibility of Western countries to do without Russian oil and gas.
There are few possible applicants for the replacement of Russia in the oil market in the world. With big reservations, three of them can be named - the United States, Venezuela and Iran. However, Caracas and Tehran have been under the dense cover of international sanctions for a long time, Alexey Gromov emphasized in an interview with Gazeta.Ru.
According to him, Russia, taking into account the sanctions pressure of the West due to the military special operation in Ukraine, has seriously reduced the volume of oil supplies. But even in this scenario, the United States, Venezuela and Iran have very little chance of replacing Moscow by December 2022.
Among the leading oil exporters are three other Middle Eastern countries that, if desired, could collectively increase the world's oil supply by several million barrels per day. These are Saudi Arabia, the United Arab Emirates and Kuwait, he added.
“Until recently, the volume of exports of Russian oil products was estimated at about 7.3-7.6 million barrels per day. The situation around Ukraine led to their reduction by a third - by 2.5 million barrels. A full embargo will instantly push stock prices for oil above $150 per barrel,” Gromov warned.
“The problem is that all three countries are members of OPEC +. The current level of monthly increase in production by 400 thousand barrels per day suits them completely. Moreover, a number of countries, including Russia, are struggling to meet current quotas. A demarche by one of the participants in the deal will automatically cast doubt on the existence of the entire agreement," Gromov concluded.
It will be impossible to replace the pipeline export of Russian gas - there are simply no worthy alternatives in the world. All the world's leading suppliers are already working hard. Of the new projects, only the Midcat and Baltic Pipe gas pipelines can be singled out. The first is to increase fuel supplies to Spain from Algeria and Morocco. The second one will connect Norway with Poland and the Baltic countries with Finland with an underwater pipe, Sergey Kondratiev, a senior expert at the Institute for Energy and Finance said.
The export prospects of the Netherlands, where the EU's largest gas field, Groningen, is located, are no better. With the start of its development in 1963, the total capacity was estimated at 2.9 trillion gas. At the moment, the facility is under threat of closure, Kondratiev stressed.
LNG is the only commodity sector where Russian gas exports can be partially crowd out. Here, a lot will depend on the United States and Qatar - it is these countries that can increase the supply of liquefied fuel abroad in the near future, Gromov emphasized.
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