OPEC+ Agrees to Resume Oil Production in September

— I think that the previously agreed decision will be implemented. But the question is how OPEC+ will behave in general in the circumstances when Trump is trying to put pressure on buyers of Russian oil. There are now a lot of comments on the topic that Saudi Arabia and other countries in the region may increase production to compensate for the oil that India, for example, will not want to take from Russia. In fact, this means a complete collapse of OPEC+, a complete collapse of the strategy that Saudi Arabia, among others, organized. Therefore, in my opinion, the fact that a decision has been made, say, to restore previously reduced production, that it is not being implemented on time, that some nuances are not being worked out, is still a sign that OPEC+ is more alive than dead. This is fundamentally important for us now in order to withstand these new sanctions that the Trump administration may apply against us.

— How will this affect the oil market in the current conditions and in anticipation of duties?

— For buyers of Russian oil, I think these factors are currently lying on the equilibrium arc. That is, on the one hand, the volume of production is recovering, this is a reason for speculators to play for a decrease in the price of oil. As for Trump, he is escalating everything, and escalation can lead to panic in the market, when players will believe that there is a persistent violation of established trade chains, and so on. Therefore, Trump, with his threats against India or Russia, is raising oil prices.

— Of course, it is extremely important for India to maintain Russian supplies, because Russia is currently the largest seller of oil for India. Russia accounts for approximately 40% of Indian oil imports. In general, the next supplier has quite a large gap, that is, Iraq, which ranks second, now supplies about 1 million barrels per day, given that Russian oil comes at a small discount for India, and Russia is the most profitable supplier, naturally, and therefore is in the lead.

— What are the risks for India?

— By refusing Russian oil, it will at least buy oil at world market prices, which will already lead to significant losses, and at most it understands that there is a risk that Russia may not be able to sell all these volumes that it supplies to India to other markets, then it will have to reduce production, and if the Russian Federation reduces its production, this will cause a deficit on the world market and an increase in prices. And India will not only buy the volumes that it now takes from Russia at a discount at market prices, but it risks getting them at extremely high prices, that is, any oil for India will then cost three digits - at the peak it can be $ 150 per barrel. Therefore, of course, India does not want to take risks. Yes, it has an established business, they have built many refineries on the coast, they buy oil and the resulting oil products there, then export them to the markets of third countries, only part of the supplies go to the domestic market of India. That is, India has an established business and does not want to give it up. Therefore, I think that they will still resist pressure from the United States, understanding perfectly well that in fact the United States itself does not need this, they do not need the risk of an oil deficit on the global market, because the United States itself is an importing country. Everyone understands that if the United States simply wanted to deprive Russia of income from oil exports, they would introduce the same sanctions against the Russian Federation as against Iran and Venezuela, that is, prohibiting anyone from buying Russian oil, but they are not doing this, they are specifically introducing a floating instrument, under which they can introduce some duties on goods from countries that buy Russian oil. That is, these are clearly not sanctions against Russia in fact, but the creation of an instrument of pressure on third countries.