Page 104 - RusRPTDec22

Saudi Arabia and other OPEC countries are discussing the possibility of increasing oil production to 500 thousand barrels per day, this may be announced at the next meeting, which will be held on December 4, the WSJ reports. If a decision is made, it will be the day before the EU oil embargo and the G7 oil price ceiling come into effect. However, the Saudi authorities deny the information.
Any increase in production now would mean a partial reversal of the decision taken last month to cut production by 2 million barrels per day. It supported high oil prices and was perceived as a victory for Russia, and the United States then accused Saudi Arabia of sponsoring a “special operation” in Ukraine. As a result, the decline in oil production in October led to a new chill in relations between Washington and Riyadh, which had just begun to improve after Joe Biden's summer visit.
Moscow's revenues from fossil fuel exports fell in October to their lowest levels since the Ukraine invasion, but Turkey has become a new route for Russian oil supplies to the European Union. Russia collected an estimated 21bn euros ($21.7bn) in fossil fuel exports last month, a 7% drop from September, according to the Finland-based Center for Research on Energy and Clean Air (CREA). Revenue from exports to the European Union fell by 14% to 7.5bn euros, below pre-war levels. Ankara has increased imports of Russian crude since the Ukraine invasion started in late February, the think tank said. The oil is then processed in Turkey, whose exports of refined oil products to the EU and the United States jumped by 85% in September-October compared to the July-August period, CREA said.
From December 5 seaborne cargoes of Russian crude will be banned from European markets, at a stroke wiping out a market that totaled 2.4mn b/d for 2021 according to data intelligence firm Kpler. This is a huge amount of crude oil to be replaced, and Europe is already sucking in cargoes from numerous alternative markets even before the embargo comes into force. Despite widespread ‘self-sanctioning,’ tankers still delivered 1.3mn b/d of Russian crude to Europe in October according to Kpler.
The global energy deficit may soar seven-fold by 2030 with current investment trends persisting, Chief Executive Officer of Rosneft Igor Sechin said at the 15th Verona Eurasian Economic Forum in Baku at the end of October. "With the current investment trends persisting, the global energy deficit observed in 2022 will soar seven-fold by 2030. It is necessary to increase investments in traditional energy by an average of $100bn per year by 2030, including by $44bn in the oil sector, to liquidate this deficit," he said. Investments in the oil and gas sector should rise by 20% by 2030, according to Bernstein’s analysts, Sechin added.
104 RUSSIA Country Report December 2022 www.intellinews.com