The Organization of the Petroleum Exporting Countries (OPEC) has told the European Union that it would be “nearly impossible” to replace Russian oil if supplies are cut due to sanctions or boycotts, according to reports from Reuters and Bloomberg.
“We could see a loss of more than 7 million barrels per day of Russian oil and other liquid exports as a result of current and future sanctions or other voluntary actions,” said OPEC Secretary General Mohamed Barkindo. his speech.
“Considering the current demand outlook, it would be nearly impossible to replace a loss of this magnitude,” Barkindo told the EU, per Reuters.
OPEC and the European Union met on Monday amid pressure on the European Union to impose sanctions on Russian oil over Russian atrocities in the Ukraine war. A European Commission official told Reuters that the trade bloc has also called on OPEC to consider increasing supplies.
The EU depends on Russia for about 25% of its oil imports, but the trade bloc that has banned Russian coal and is considering an oil embargo is trying to distance itself from Russian energy . But oil prices are already rising 30% year-on-year on the back of the Ukraine war due to disrupted trade flows linked to boycotts and sanctions against Russia.
OPEC’s Barkindo said the “highly volatile market” was due to political factors rather than fundamentals of supply and demand for the oil market.
“These are non-fundamental factors that are completely out of our control at OPEC,” Barkindo said, per Bloomberg.
Last month, Saudi Arabia, the world’s top oil exporter, said that OPEC+ which includes OPEC and other major producers such as Russia would leave politics in its decision-making, according to CNBC.
The country’s Energy Minister Prince Abdulaziz bin “That culture has seeped into OPEC+, so when we go into that OPEC meeting room, or OPEC building, everyone leaves their politics at the outer door of that building, and That culture has stayed with us.” Salman told the outlet.
OPEC+ last month said it would increase output by about 432,000 barrels per day in May to meet a recovery in demand as the pandemic eases.