OPEC refuses to replace Russian oil

Nouée en 2016 pour contrer l'essor du pétrole de schiste américain, l'association entre le Kremlin et Riyad a fait passer la part de marché de l'Opep de 35 % à 55 %.


It is a firm “no” from the cartel of oil-exporting countries. This Thursday, OPEC, an ally of Russia, again ignored calls from the foothills of countries consuming black gold, which are hit hard by rising barrel prices, to open the taps more widely.

In June, OPEC will limit production to about 432,000 barrels per day. A level in line with the cartel’s plan to restart production at the end of Covid-19, but which proves too inadequate to curb inflation per barrel, as Europe prepares to impose an embargo on Russian oil imports.

Tensions are rising with the United States

“The key elements of the market and the prospects show that the market is balanced. In addition, it continues to suffer from the effects associated with the current pandemic, “the 23-nation alliance said in a statement.

Since the beginning of the war in Ukraine, the cartel has shown unwavering solidarity with Moscow, a key pillar of the alliance and a promise of its influence. The link between the Kremlin and OPEC, established in 2016 to counter the rise of US shale oil, has increased the latter’s global market share from 35% to 55%.

In this context, the United States, which has already dived into its strategic reserves to curb rising prices, could mobilize again. According to CNN, the Biden government may announce a long-term purchase plan to gradually replenish its strategic crude stockpiles.

In addition, this Thursday, a decisive step was taken by the US Senate to approve a text called “Nopec” (for the “No Oil Producing and Exporting Cartel”) which would authorize Washington to sue the cartel for manipulating the oil markets. energy.

In fact, the status quo announced by OPEC should continue to raise prices. After the meeting, the price of Brent barrel reached almost 115 euros and the WTI, the reference point in the United States, around 110 dollars. “Once the European embargo on Russian oil is implemented, prices should return structurally to near $ 120 a barrel,” said Homayoun Falakshahi, a Kpler analyst.

Reduced Russian production

The market doubts the ability of OPEC countries to meet their new barrel targets, while several alliance countries are finding it difficult to increase their production capacity. According to data compiled by Bloomberg, the alliance did not release the volumes that were announced last month. Angola and Nigeria in particular regularly fail to increase their volume.

At the same time, the effects of the war in Ukraine are already visible on the market. Russian oil production, which is being boycotted by some oil companies, is starting to decline. According to research firm OilX, it was about 11 million barrels a day in March, up from 10.1 million barrels a day in early April.

And the phenomenon will increase. “In six months, the European embargo will lead to a significant loss of Russian crude production, of the order of 2 million barrels per day compared to the levels of March 2022,” Rystad Energy analysts estimate.

Firstly, because all existing infrastructure limits Russia’s export potential to Asia. There are only two oil pipelines passing through Kazakhstan and Eastern Siberia and tankers will not necessarily be available, which will limit the ability of India and China to absorb flows destined for Europe. Then because Russia’s storage capabilities are used almost all. “Russian crude production will shrink due to falling demand,” say Rystad Energy analysts.

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