Putin says global demand for oil and oil products is increasing.

Putin says global demand for oil and oil products is increasing.

Russian President Vladimir Putin has stated that global demand for oil and oil products is increasing, despite the ongoing conflict between Israel and Iran. Speaking at the St Petersburg Economic Forum, Putin downplayed the impact of the conflict on oil prices, asserting that the increase in prices was not significant [1].

Putin noted that while the conflict has led to a slight rise in oil prices, the current price of oil stands at around $75 per barrel, compared to $65 before the escalation. He emphasized that the OPEC+ group, which includes Russia, is gradually increasing oil output to maintain balance in the market and ensure comfortable prices [1].

Separately, Equinor and its partners Var Energi and Inpex Idemitsu Norge have announced plans to invest over $2 billion in the North Sea Fram Sor project. This project aims to develop four oil and gas fields, bolstering Europe's energy security [2]. The investment will be made over a period, with production scheduled to start by the end of 2029.

Meanwhile, Russia has seen a surge in its fuel oil and vacuum gasoil (VGO) exports to India and Turkey in May, as buyers preferred to purchase more fuel oil amid falling prices. Russia's oil product exports to India almost doubled in May compared to April, reaching 600,000 tons, while exports to Turkey increased by 75% to 430,000 tons [3].

Despite the increase in exports, Russia's oil revenues have dropped significantly. In May, oil and gas revenue for Russia's budget totaled $6.5 billion, a plunge of over 35% compared to the same month of 2024. The revenue was the lowest since June 2023, according to Bloomberg calculations [3].

In conclusion, Putin's assertion of increasing global demand for oil and oil products aligns with the recent trends in oil exports and market dynamics. The North Sea Fram Sor project, along with Russia's strategic export moves, underscores the ongoing efforts to balance the global oil market and meet the growing demand.

References:
[1] https://www.business-standard.com/world-news/no-opec-action-needed-amid-iran-israel-conflict-says-putin-on-oil-market-125062100019_1.html
[2] https://www.marketscreener.com/quote/stock/EQUINOR-ASA-1413290/news/Equinor-and-Partners-to-Invest-Over-2-Billion-in-North-Sea-Oil-and-Gas-Project-50341398/
[3] https://oilprice.com/Latest-Energy-News/World-News/Russias-Fuel-Oil-Exports-to-India-and-Turkey-Jump-as-Prices-Drop.html