MOSCOW: Amid turbulence on the global energy market its participants are turning back to Russia as a reliable supplier, Prime Minister Mikha...
MOSCOW: Amid turbulence on the global energy market its participants are turning back to Russia as a reliable supplier, Prime Minister Mikhail Mishustin said at the opening of the strategic session "Development of the Fuel and Energy Complex."
TASS has compiled the Prime Minister's key statements on the situation in energy markets.
Energy market situation
Escalation of the conflict in the Middle East has led to the emergence of "new serious challenges" and has affected "not only the oil and refined product markets," but also other important commodities.
Approximately 10% of global liquid hydrocarbon production was suddenly removed from the market due to the situation in the Persian Gulf.
"Established sea routes were disrupted, effectively paralyzing one of the most important international transport corridors in the Persian Gulf. As a result, approximately 10% of global liquid hydrocarbon production was suddenly removed from the market," Mishustin said.
Restoring infrastructure and shipping routes in the Persian Gulf region will require significant time.
"It will, of course, take considerable time and significant investment to restore processes, infrastructure, and the transportation of goods. This has already impacted prices," the Russian Prime Minister said.
Rising energy prices have led to trade imbalances.
"Oil prices have surged significantly, and gas prices even more, almost doubling, in both Asia and Europe. This has all led to significant imbalances in global trade," Mishustin stated.
Inflationary pressure will increase globally due to the situation in the Persian Gulf.
"Gasoline, diesel fuel, jet fuel, and ship charter prices are rising globally. Rising oil and gas contract prices will inevitably lead to a significant increase in the burden on related industries. This will also impact transportation services, logistics, and electricity. Industrial costs will rise, and, consequently, inflationary pressure will increase," the Russian Prime Minister said.
Russian energy market
The current global situation is opening up new economic opportunities for Russia.
"For our country, the current situation, from a purely economic perspective, is opening up new opportunities to improve the financial situation of export-oriented industries and generate additional budget revenue," Mishustin said.
"During turbulent times, the global market returns to Russia as a reliable supplier. This applies not only to oil and gas. Our country has the potential to increase supplies abroad of resources that are currently in short supply due to the Middle East crisis, or may become so in the near future," Mishustin said.
He noted that the discount on Russian oil is narrowing under current conditions.
The Prime Minister also stressed that the government should prevent the situation when the external price shock in the fuel sector could affect Russian consumers.
"Protecting the domestic market remains our top priority. We cannot allow the external price shock to be transferred to Russian consumers. We must ensure a reliable supply and a reliable balance," he said.
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