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said at a press conference on December 3. The EU Council made the decision at a meeting at the level of energy ministers, reports Neft i Kapital. Simson stated that the EC is working on a package of proposals to regulate the natural gas and hydrogen markets. She also added that, despite the extremely high prices of natural gas in 2021, hub-linked gas prices will deliver gas more cheaply to the Continent over time than long-term oil-linked prices.
Both main OPEC scenarios see oil surpluses in 2022. Interfax reported. OPEC’s technical committee met yesterday to consider a report from its analysts ahead of the full OPEC+ meeting today. The base scenario is essentially the same as the one presented last month and foresees global commercial reserves 170mn bbl below the 2015-19 average by the end of 2021. However, the oil market should turn from being 1.2mmbpd undersupplied in 2021 to an average 1.6mmbpd oversupplied in 2022, leading to growth in reserves to only 6mn bbl below normal by 2Q22 and 104mn bbl above normal by YE22, including planned releases of 71mn bbl from various countries’ strategic petroleum reserves, primarily those in the US. The alternative scenario tests lower demand and higher non-OPEC production and sees an average oversupply in 2022 of c3mmbpd and 4Q22 commercial reserves 248mn bbl above normal.
9.1.2 Automotive sector news
Russia's new car and LCV market saw another month of decline in November, as sales (excluding Mercedes-Benz and BMW) were down 20.4% y/y to 125,466 units, according to the latest report published by AEB.
The reason for this decline remained broadly unchanged, with the microchip shortage continuing to weigh on the supply side, coupled with the relatively high base effect of November 2020. We note that, due to the strong 1H21, 11mo21 sales were still 6.9% higher than in 11mo20, at 1.4mn units. Assuming that the rate of decline remains broadly unchanged in December, we believe that the FY21F sales of new cars and LCVs will increase 4% y/y to 1.67mn units.
Soller's UAZ brand sales underperformed the overall market trend, showing a decline of 25% y/y in November to 3,070 units, while its 11mo21 sales decreased 2% y/y. In contrast, Ford Transit sales (produced by the JV with Ford, is consolidated by Sollers) massively outperformed the market, increasing 74% y/y to 2,123 units in November. Its 11mo21 sales were up 52% y/y to 17,739 vehicles. We remain neutral on Sollers (Hold; 12-mo TP RUB250; ETR 19%) due to the bleak prospects for its UAZ brand, as well as the uncertainties over the company's strategy towards minority shareholders.
The AvtoVAZ/Renault/Nissan/Mitsubishi alliance remains the leader on
88 RUSSIA Country Report January 2022 www.intellinews.com