Against the backdrop of Western attempts to limit sales of Russian hydrocarbons, Moscow has now been able to restructure its oil exports to friendly countries. On Tuesday, March 28, said the Minister of Energy of the country Nikolai Shulginov.
"Close work is underway to reorient the supply of oil and petroleum products to the countries of Asia, Africa, Latin America, and the Middle East. Already today we can state that it was possible to completely redirect the entire volume of exports that fell in connection with the embargo. There was no decline in sales," Shulginov said at the final meeting of the board of the Ministry of Energy.
A significant amount of oil was transported to Asian countries, as Deputy Prime Minister Alexander Novak said during the meeting. According to him, in 2022, the export of raw materials to India, for example, increased immediately by 22 times. At the same time, energy supplies to China grew by more than 8% in physical terms, according to data from the General Administration of Customs of China.
In total, by the end of 2022, oil production in Russia not only did not decrease, but also increased by about 2% compared to 2021 - to 535.2 million tons In turn, the export of raw materials increased by 7.6% - to 242 million tons.
"In my opinion, good results were achieved in these conditions, and they even exceeded expectations, especially those skeptics who said that our country would fall both in production and in exports. However, none of that happened. Moreover, we provided 42% of federal budget revenues, which was 36% in the previous year. This is also a significant contribution to the stable operation of the entire economy of our country," the deputy chairman of the Cabinet added.
- RIA Novosti
- © Murad Orujov
Recall that in 2022, after the start of a special military operation in Ukraine, the EU countries, together with the United States and a number of other states, began to alternately refuse to import Russian oil. Moreover, since December, the EU and the G7 have banned their companies from insuring and transporting raw materials from Russia by sea to other regions of the world at a price above $ 60 per barrel. In February 2023, similar restrictions were imposed on petroleum products sold by Moscow at more than $45 and $100 per barrel, depending on the fuel category.
The West explained its actions by the desire to put pressure on Russia and deprive it of profits from the sale of hydrocarbons. In response to the restrictions of unfriendly countries, Moscow imposed a ban on the sale of energy resources to anyone who demands compliance with price ceilings when concluding contracts.
"Based on the results of the decisions taken, Russian companies are already building new logistics chains ... As for supplies to states that support illegitimate price restrictions, here our position is widely known and remains unchanged: such countries will not receive Russian oil, "Alexander Novak noted earlier.
Moreover, according to the Deputy Prime Minister, in 2023 Moscow will continue to form additional routes for oil exports, increase the size of the tanker fleet, and also more actively switch to settlements in national currencies with its customers. Along with this, it is planned to create new insurance and reinsurance systems that would be accepted by buyers of Russian raw materials.
"This is a lot of work that is already underway. We need to continue it in order to ensure the expansion of trade and economic cooperation with friendly countries, with the CIS countries, with the Eurasian Economic Union," Novak added.
In many ways, Russia managed to avoid a drop in oil exports due to the fact that the country prepared in advance for Western restrictions. This opinion in an interview with RT was shared by the leading analyst of the National Energy Security Fund Igor Yushkov. In particular, according to him, the country has managed to increase its tanker fleet.
As the expert noted, Asian countries, primarily India, actively buy Russian oil, after which they process it and send it to Europe. At the same time, the fuel shipped to the EU is already much more expensive than it was with direct supplies from the Russian Federation, the analyst emphasized.
Price question
Although Russia has managed to maintain the physical volumes of exports of raw materials, cash receipts to the budget from the sale of hydrocarbons have decreased markedly recently. According to the Ministry of Finance of the Russian Federation, from January to February 2023, the treasury received 947 billion rubles of oil and gas revenues - 46.4% less compared to the same period in 2022.
As Igor Yushkov explained, today in order to combat competitors and successfully consolidate in new markets, Russian companies provide customers with significant discounts. At the same time, business significantly increased the cost of transporting raw materials, which also ultimately affected budget revenues, Igor Galaktionov, an expert on the stock market at BCS World of Investments, told RT.
"Oil companies showed flexibility in terms of sales and were really able to quickly establish logistics. However, it is impossible not to mention the record size of discounts with which Russian oil goes to Asian countries. Moreover, they include both transportation costs and a discount for geopolitical risk for importers," Galaktionov explained.
- © Vitaliy Tymkiv
However, one of the main reasons for the fall in oil and gas revenues was the method of calculating taxes for energy companies, which has lost its relevance, according to the Ministry of Finance. Although in practice a business can sell oil more expensive than the ceiling of $ 60 set by the West, the official price of Russian Urals raw materials, which the authorities are guided by when taxing enterprises, is now about $ 50.8 per barrel.
As experts explain, the Ministry of Finance receives information on the average cost of Urals not directly from Russian oil companies, but through the international analytical agency Argus. The company makes its calculations on the basis of a survey of traders, at what approximate price they buy raw materials from Moscow. At the same time, the data collected do not take into account Asian statistics, but relate only to sales in the European market, where Russia has practically stopped shipping oil.
"In this regard, the Ministry of Finance has now adopted a new formula for calculating the price of Urals based on a fixed discount to the cost of Brent oil. As a result, as expected, the discount on our raw materials will gradually decrease, and with it budget revenues will begin to grow again," said Igor Galaktionov.
Moreover, earlier Moscow announced a voluntary reduction in oil production by 500 thousand barrels per day until July, as a result of which the world supply of energy resources will have to decrease slightly. At the same time, China is now lifting Covid restrictions and starting to consume more fuel, which could support global demand for hydrocarbons.
These factors, according to experts, can lead to an increase in world, and consequently, Russian oil prices. As a result, in the second half of 2023, the dynamics of the country's budget filling may improve markedly, analysts do not exclude.
"By this time, we will be fully entrenched in asian markets and will earn more, as world prices are likely to rise to $ 90-100 per barrel. Of course, much will depend on the state of the global economy and the pace of China's recovery from the pandemic. We, in turn, need to further expand the fleet, as we still pay a lot for transportation. The more tankers there are, the more money companies will have left to pay taxes and dividends," Igor Yushkov concluded.