Western embargo and price cap won’t affect Russian production, says country’s energy ministry
Russian oil production will not fall off a cliff after the imposition of the EU-G7 price cap on the country’s crude, First Deputy Energy Minister Pavel Sorokin said on Thursday.
He said the majority of markets remain open to Russia due to growing demand, while fluctuations in oil production are not critical.
The deputy energy minister told reporters that the global oil market is currently experiencing a supply shortfall, especially in diesel, which will support prices.
Meanwhile, data from rating agency ACRA showed that Russian oil companies have managed to “fast enough” restore the level of production and supply despite several rounds of Western sanctions.
The report, quoted by business daily RBK, said the total volume of oil production between January and October, including gas condensate, increased by 2.4% compared to the same period last year, reaching 443 million tons. Energy giant Rosneft reportedly increased its exports to Asia by a third, offsetting a drop in supplies to the European Union.
Western sanctions won’t stop demand for Russian oil – Moscow
The latest embargo on Russian maritime crude and the price cap agreed last week by the EU, G7 countries and Australia came into force on December 5. The cap sets the maximum price at which Russian oil can be sold at $60 per barrel and prohibits Western companies from providing brokerage, shipping, insurance and other services to shipments sold above that threshold.
Russia, which has repeatedly warned that it will not sell its oil to countries that support price caps, is preparing a response.
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