Page 10 - RusRPTOct23

In Slovakia, Prime Minister Ludovit Odor Odor signalled last week that Slovakia prefers a European solution on imports of grain from Ukraine , but if there is no common European framework, then the country would act on its own.
2.2 Russia big winner from OPEC+ production cuts
Russia is the big winner from OPEC+ production cutbacks. As several prominent members of the group, led by Saudi Arabia, have embarked on output reductions since May with the aim of boosting prices and achieving market equilibrium, Russia's stance has shifted significantly.
Saudi Arabia, a driving force in these efforts, took an extra stride in July by implementing an additional, unilateral cut of 1 million barrels per day. This decision, extended twice already, may well see further extensions in the near future.
In response to the changing landscape, Russia, which had initially indicated intentions for curbs of its own in response to Western sanctions and restrictions on oil exports, belatedly joined forces with Saudi Arabia, commencing a reduction in shipments in July.
These cutbacks have undoubtedly contributed to bolstering crude oil prices, although perhaps the impact has not been as substantial as the producers had originally hoped for. Additionally, the wavering growth in China is casting shadows on some of the optimistic forecasts for the remainder of the year, prompting the extension of Saudi cuts to mitigate uncertainties.
It's essential to recognize that Saudi Arabia is shouldering a significant burden. Since February, the country has managed to curtail crude production by a staggering 1.22 million barrels per day – a reduction more than 2.5 times greater than the corresponding reductions by Moscow.
Stepping back to February, when the Kremlin announced plans to withhold a portion of its supply, Saudi production exceeded Russia's by 500,000 barrels per day. By July, this gap had reduced to 250,000 barrels per day. This trend seems poised to continue in the foreseeable future.
The impact of production curbs on Saudi Arabia's growth became evident in the second quarter, transforming the nation from one of the fastest-expanding major economies into one of the slowest. A crucial financial lifeline was thrown by state company Saudi Aramco, rescuing the budget from a looming deficit this year.
In stark contrast, Russia's financial coffers have experienced rising inflows due to higher prices – a factor that influences per-barrel tax rates – and narrower discounts for its crudes when compared to international benchmarks. A notable milestone was achieved last month when both oil and natural gas revenue rose for the first time this year.
10 RUSSIA Country Report October 2023 www.intellinews.com