Key points from the discussion:
- OPEC can compensate for the incremental loss in Russian oil supplies, primarily the Gulf Cooperation Countries (GCC) – Saudi Arabia, UAE and Kuwait, as they sit on the lion share of OPEC’s spare capacity.
- From last year, OPEC+ resisted calls to put more barrels in the market. However, a recent shift in tone emerged ahead of OPEC+ June meeting with reports about Saudi Arabia’s willingness to step in should Russia’s oil production fall dramatically.
- Despite the challenges, banning Russian oil is a much easier option for the EU than banning gas. Oil markets are global unlike natural gas which is still at large a regional business and finding alternative supplies swiftly is very difficult.
“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
“Global oil markets and OPEC+ plans“, Dr Carole Nakhle, Jun 2022
“Russian gas: Ruble payments and outlook“, Dr Carole Nakhle, May 2022
“A new oil cartel?“, Dr Carole Nakhle, May 2022
“EU Sanctions on Russian Oil“, Dr Carole Nakhle, May 2022
“EU Talks to Ban Russian Oil“, Dr Carole Nakhle, May 2022