Some of the main points covered during the interview:
- Despite the growth in LNG, gas markets remain regional. Germany is still significantly exposed to Russia given the lack of immediately available alternatives – the main reason why the European Union hasn’t sanctioned Russian gas yet.
- Energy prices are feeding into inflation, and many believe a recession is inevitable.
- A price cap on Russian oil is a simple and appealing concept but its execution, especially by several countries, is fraught with complexity. Besides, there are many ‘ifs’ to make it work including assuming that Russia would not retaliate by cutting supplies. Additionally, other large buyers of Russian oil, such as China and India, must be brought on board for the cap to become effective.
- Russia is an important player for the longevity of OPEC+ and its impact on the market. The country is producing more than double of what the second largest producer in OPEC (Iraq) is producing. Although OPEC+ might suspend Russia’s quotas in the group, it would be hard for the organisation to turn its back to an important member such as Russia to the dismay of the West.
“Energy Sanctions and the Global Economy: Mandated vs Unilateral Sanctions“, Christof Rühl, May 2022
“Sanctions and the Economic Consequences of Higher Oil Prices“, Christof Rühl, Apr 2022
“Energy Markets and the Design of Sanctions on Russia“, Christof Rühl, Mar 2022
“OPEC+ alone can’t fix Joe Biden’s oil problem“, Dr Carole Nakhle, Jul 2022
“Global Economy and Energy Markets Weekly Commentary – 23rd Jun ’22“, Dr Carole Nakhle, Jun 2022
“OPEC, Oil Prices, and the US: Reasons for, and Solutions to, the Current Crisis“, Dr Carole Nakhle, Jun 2022
“Oil Slides on Saudi Output Report“, Dr Carole Nakhle, Jun 2022
“Global oil markets and OPEC+ plans“, Dr Carole Nakhle, Jun 2022