Page 8 - NorthAmOil Week 09 2022

NorthAmOil POLICY NorthAmOil

Unmoved by Ukraine conflict,

OPEC+ sticks to its guns

GLOBAL THE OPEC+ group surprised nobody in the Paris-based International Energy Agency (IEA)
industry this week when it announced that it would release 60mn barrels from their strategic
would add 400,000 barrels per day (bpd) of petroleum reserves (SPRs), with half of that com-
combined oil production in April, as crude prices ing from the US. (See previous story) IEA Exec-
continued to defy gravity. utive Director Fatih Birol said: “The situation in
Following a meeting in Vienna on March energy markets is very serious and demands our
2, the group signed off on the now-custom- full attention. Global energy security is under
ary easing of quotas, though data showed that threat, putting the world economy at risk during
its January output was nearly 1mn bpd below a fragile stage of the recovery.”
target. However, the IEA’s efforts to reduce prices
The US has repeatedly asked OPEC kingpin failed to counter the geopolitical and supply
Saudi Arabia to increase production to bring security risk premium associated with the
prices lower, but Riyadh, and other members of ongoing conflict in Ukraine as ICE Brent crude
the group have been united in reiterating their futures hit a nine-year high of $113.94.
dedication to the 2020 deal that has stabilised Concerns about the OPEC+ group’s ability to
markets and bolstered prices. ramp up output were clearly a factor in the rise
Perhaps the clearest expression of the indus- with data from OPEC’s Joint Technical Com-
try’s perspective was given Bahrain’s Oil Minis- mittee showing that production in January had
ter HE Mohammed bin Khalifa bin Ahmed Al missed the 23-nation group’s 40.493mn bpd by
Khalifa during last week’s International Petro- 972,000 bpd.
leum Technology Conference (IPTC) in Riyadh. For the long-term sustainability of the deal,
He thanked Saudi Energy Minister and “captain members will be urged to redouble efforts to
of the ship” Prince Abdulaziz bin Salman Al Saud increase output, particularly in view of last
for his role in steering the oil industry away from year’s upward adjustment of the baseline for the
the “edge of the abyss”. OPEC+ quotas, which will unwind the restric-
With the OPEC+ position clear, this week tions by almost 1.6mn bpd when it comes into
started with the news that 31 members of the effect in May.™

Canada bans Russian oil imports

CANADA CANADA announced on February 28 that it an analysis of government data by Johnston.
would ban imports of Russian oil in response The value of last year’s petroleum imports
to Moscow’s decision to invade Ukraine. It is from Russia was estimated at about CAD350mn
the first G7 country to impose an embargo on ($275mn), the Financial Post said, citing data
Russian oil. compiled by the Business Council of Alberta.
The move, announced by Canadian Prime According to the council, the value of oil and
Minister Justin Trudeau, was seen as largely oil product imports from Russia reached
Canadian Prime symbolic given that Canada’s imports of Russian CAD884mn ($694mn) in 2019.
Minister Justin Trudeau crude are limited. Canadian Minister of Natural This compares with total energy imports to
Resources Jonathan Wilkinson clarified the next Canada worth CAD32bn ($25bn) in 2021, with
day that the ban would also include the import of the US, Saudi Arabia and West Africa also sup-
refined petroleum products and other oil prod- plying significant volumes.
ucts from Russia. Also this week, the Canadian Association of
The Financial Post cited information from Petroleum Producers (CAPP) called for the fed-
Commodity Context’s analyst and founder, eral government to make a “clear commitment”
Rory Johnston, as well as the Canada Energy to grow the country’s oil and gas production and
Regulator (CER), as showing the country had exports in light of the situation in Ukraine.
not imported any Russian crude oil since 2019. “Over the last decade, issues like energy secu-
That year, Canada imported about 18,000 bar- rity and country of supply have not been very
rels per day of oil from Russia, out of total crude high on the public’s radar,” the Canadian Press
imports of 963,000 bpd. In 2021, the country quoted CAPP’s president, Tim McMillan, as
imported 10,000 bpd of petroleum products saying. He added that Canadian producers were
from Russia last year, with gasoline and gasoline ready and willing to play a larger role in global
blends accounting for about 50%, according to energy supply in the coming decades.™

P8 www. NEWSBASE .com Week 09 03•March•2022