Military Review

Europeans and Russian oil: outsiders in councils, but acting as their own

Europeans and Russian oil: outsiders in councils, but acting as their own

When will that day come?

On the eve of “Day X”, which should happen either on December 5, or even on November 23, of course, it is difficult to write about Moscow's victory in the confrontation in the oil market. Nevertheless, such publications in the Western press are now no less than harsh anti-Russian ones.

The European Union understands quite well that doing without Russian oil is in many ways even more difficult than without gas. No, the situation with alternatives to our oil is actually better in some respects than with gas. However, everything points to the fact that the embargo, whatever it ends up being, will in itself push oil prices up sharply.

The hydrocarbon market, as is well known, is very sensitive, but so far oil futures do not even think of preempting the quite expected “serious consequences”. Most likely, the point here is that few people believe in the reality of these consequences.

The EU now needs an embargo, or rather the appearance of an embargo, for only one thing - to save face and avoid accusations that no one in the EU leadership is doing anything. In response to the assumptions of economic authorities from the West, what opportunities Russia has to circumvent sanctions, an asymmetric response immediately follows from Russia itself.

From the Russian Federal Assembly, and not only from several specialized and not very Duma committees, there were warnings, or rather, reciprocal advice or recommendations addressed to official Brussels. However, the Federation Council spoke much tougher and more concretely.

Thus, the representative of the Perm Territory in the upper house of our parliament, Aleksey Pushkov, who is listed in the West as one of the "Russian hawks", simply reminded that Brussels still has

“there is time to adjust our own restrictive measures and abandon such an embargo, in full accordance with the official principle of the EU.”

Well, the recent statement of the relevant Deputy Prime Minister of the Russian government Alexander Novak at the international energy forum sounded like a “response” ultimatum:

“Our country will stop deliveries if the ceiling on the cost of Russian oil, the introduction of which is now being discussed by the G7 countries, is less than the cost of its production. Russian oilmen will not work at a loss. We will continue to divert oil supplies to market-oriented partners or cut production.”

Change of course

The turn to the East, widely declared by Russia in relation to its raw material exports, cannot take place to the extent that it does not notice either the embargo or the price ceiling, without the appropriate infrastructure. We can assume that there are no pipelines suitable for deliveries to China and India, although what we produce in Vietnam is already being exported, and with a constant increase in supply volumes.

Today we are talking about the need to urgently increase tanker capacities. It is believed that to maintain the required level of supplies to Asian countries, Russia needs at least 500 vessels, but so far our companies have managed to purchase only about 240 vessels. However, this is still summer data, there are no more recent and accurate ones yet.

This only means that Russia will still not be able to manage without semi-legal distribution channels. The practice of resale, the notorious mixing of different grades of oil, the actual oil smuggling, alas, will have to be used. But this leads not only to an increase in sales volumes, but also to a drop in profits, perhaps even more than because of the price ceiling.

Due to the fact that not the whole world opposed the Kremlin's policy in Ukraine, as biased Western media say, it turned out to be impossible to prohibit the purchase of ships “for Russians”. All-knowing experts from Bloomberg do not just complain:

"If you look at how many ships have been sold in the last six months to unnamed buyers, it's pretty clear that a fleet is being built to carry them."

Interestingly, at the same time, the European Union fails to completely block the export of raw materials from Russia also with the help of a ban on the reinsurance of tankers with Russian oil. The Frankfurter Allgemeine Zeitung was the first to report this, where the next package of EU sanctions was simply called “leaky”.

The Western media are now competing in counting the options open to Russia in terms of circumventing sanctions, embargoes and fighting against price ceilings. At first, there were only two opportunities for heroes who, like in the cult Aibolit-66, "go around".

On the first - the second pay off!

Oddly enough, but the first route is pipeline, since all EU bans affect only oil supplies by sea. Yes, there are such problems with pipes now that transit becomes very dangerous. But not everywhere, and there are still a lot of those who are ready to accept Russian oil on the world map, you don’t even need to name them.

The second option for circumventing sanctions is already being fully used by buyers, even from those countries that are most active both in anti-Russian rhetoric and in restrictive measures. It's about the old idea of ​​mixing Russian raw materials with foreign ones.

Who in this case will be considered as the source of origin of the imported resource will not be easy to understand, although the analysis of the mixture is not a problem. But this has already happened with gas, no analysis helps there, and American companies have already bought Russian LNG, then reselling it to Europeans.

Again, those who want to “rescue” the Russians in this uncomplicated way, almost line up in a queue. Here they call Turkey, and Hungary, and Serbia, which is understandable, and also Greece, Italy, and even, you won’t believe it, Poland. Who is against profiting from someone else's grief?

It remains to be recalled that at the moment a partial embargo is already in effect against Russia, which entered into force on June 2. It was part of the notorious sixth package of anti-Russian sanctions, perhaps the toughest. Then two-thirds of Russian imports of black gold were cut.

So, only a third remains to cut. But in practice, Russia has lost almost nothing since then in terms of export volumes. And even the most anti-Russian media see no paradox in this. But they see well there and know how to count the losses of European budgets from anti-Russian sanctions.

Well, to ban the purchase of Russian oil by third countries, which the United States and the EU are striving for with all their might, is, in fact, impossible. This cannot be, because it can never be, as in Chekhov.

Suffice it to recall how the EU "recorded" Hungary as a participant in the sanctions. In fact, they simply gave her a compensation, since by today's standards the amount there is small, and how the country will quietly solve its problems with fuel is not the concern of the sanctioners.
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  1. voice of reason
    voice of reason 24 November 2022 04: 22
    The author is completely unaware of the issue. the pipeline system of the Russian Federation is connected into a single complex. The Power of Siberia gas pipeline still has a reserve of pumped capacity and is not completely filled. Immediately built with such a possibility with a margin in excess of contractual obligations. And there is also the Power of Siberia 2. And the construction of the third branch through Altai has already begun. There is nothing to say about the Eastern Siberia-Pacific Ocean oil pipeline - for many years the Skovorodino branch has been functioning just to China. what tanker fleet? learn materiel.
    1. User_neydobniu
      User_neydobniu 24 November 2022 05: 19
      There is one thing, but will the West allow us to supply all the oil and gas produced to our oligarchy to China? Or force them to continue delivering to Europe despite the sanctions
      1. Leader_Barmaleev
        Leader_Barmaleev 24 November 2022 09: 55
        There is one thing, but will the West allow us to supply all the oil and gas produced to our oligarchy to China?

        It's not but, it's well. And one thing is that will the supreme power of Russia have enough political will to insert a soldering iron to the oligarchy in the place where the laser did not shine, or the aforementioned authorities will continue to shyly lick this place, pretending that the oligarchs are equidistant from influencing the country's economic strategy. The answer, of course, is obvious, if only due to the fact that the head of the Central Bank of the Russian Federation is agreed and approved by the relevant US Senate committee, but I want to believe that sooner or later this abscess will burst.
        1. User_neydobniu
          User_neydobniu 24 November 2022 12: 29
          And one thing is that is there enough political will for the supreme power of Russia to insert a soldering iron to the oligarchy in the place where the laser did not shine

          Crow does not pick out the crow
      2. Terran ghost
        Terran ghost 24 November 2022 10: 28
        Quote from: User_neydobniu
        will the West allow to supply

        You are not asking the right question. The correct wording is "and under what conditions and at what price will China express a desire to buy this very oil";)
      3. voice of reason
        voice of reason 24 November 2022 18: 18
        and here some mythical oligrahat? gas is supplied by PJSC "Gazprom" a controlling stake from the state.
    2. Woodman
      Woodman 24 November 2022 08: 31
      Quote: voice of reason
      The Power of Siberia gas pipeline still has a reserve of pumped capacity and is not completely filled.

      If I am not mistaken, this is due to the fact that China has not yet completed its part of the pipelines to Shanghai, as planned.
  2. parusnik
    parusnik 24 November 2022 05: 29
    Already by the title, you recognize the authors and were not mistaken.
  3. Taimen
    Taimen 24 November 2022 07: 55
    We are now on errands. They will allow or not. merchants, Kirkorovs, hucksters and all the trash that ruined the country to the tune of the USA. Or there will be principalities, if allowed from the West.
    1. Woodman
      Woodman 24 November 2022 08: 42
      Quote: Taimen
      The cost is set.

      2 times higher than the current price, if anything. Really
      Quote: Taimen
      A disgrace. This has never happened either under the tsars or under the USSR.

      Both under the tsars and under the USSR, such conditions would only be laughed at.
      Quote: Taimen
      Allowed or not allowed.

      So it is they who will not "allow / not allow" to sell to Russia, but exclusively to "themselves loved ones" they "allow / do not allow" to BUY from Russia.
    2. Terran ghost
      Terran ghost 24 November 2022 10: 37
      Quote: Taimen
      traders, Kirkorovs, hucksters and all the trash that ruined the country

      Oh, what wonderful "discoveries" drove up. It turns out that some "traders" and personally Philip Kirkorov are to blame for the collapse of the USSR. And apparently not the top of the then (mid-late 1980s) leading nomenclature of the CPSU.
      PS: However, one should not confuse cause and symptom here. The reason for the collapse of the USSR is painfully banal - by the mid-1980s, this very leading nomenclature of the Union no longer believed in the possibility of building communism in practice. That's all. The USSR, on the other hand, was an ideocratic state built around the belief that a) communism can be built in the foreseeable future (“even during the lifetime of the current generation of Soviet people”) and b) that the construction of communism is possible using the methods by which it was built by the RCP (b) - VKP(b)-CPSU. As soon as this faith lost its position, alas and oh, but the collapse of the USSR was only a matter of time.
  4. kor1vet1974
    kor1vet1974 24 November 2022 08: 25
    And when will the West cease to exist, if everything is so wonderful with us?
  5. BAI
    BAI 24 November 2022 08: 48
    Today we are talking about the need to urgently increase tanker capacities. It is believed that to maintain the required level of supplies to Asian countries, Russia needs at least 500 vessels, but so far our companies have managed to purchase only about 240 vessels.

    Having your own tanker fleet does not solve anything. It needs insurance, and without insurance, a ship will not enter any port.
    The only way out is to pump from tanker to tanker at sea, if there is another tanker that wants to risk falling under secondary sanctions
    1. tralflot1832
      tralflot1832 24 November 2022 12: 39
      We have three insurance companies in Russia until their insurance is recognized. There will be an order from above and the animal will come to someone. The buyers who recognize the order will be the first to suffer. But the painful question is Suez, a stumbling block and the straits.
  6. tralflot1832
    tralflot1832 24 November 2022 12: 36
    Sovcomflot, the main carrier of Russian tanker oil, has classified its tonnage. Sovcomflot has a 100% stake in the state.
  7. Viktor Sergeev
    Viktor Sergeev 24 November 2022 12: 39
    When you say that Russian oil can be replaced with alternative oil, first find out what our oil is and how it can be replaced in principle. Yes, our oil can be replaced with oil from Iran and Venezuela, a great choice for the EU and the US.
    1. Terran ghost
      Terran ghost 24 November 2022 17: 38
      replace with oil from Iran and Venezuela, a cool choice for the EU and the US

      Well, firstly, oil from Iran is quite a normal choice for the European Union. Actually, the EU therefore strongly lobbied for the very "Iranian nuclear deal" of 2015.
      There is one caveat with oil from Venezuela. Actually, even two.
      First, this oil is mostly extremely heavy. For commercial sale, it was diluted with light oil purchased abroad. Before the US oil embargo in 2019, this lightest oil was bought from ... the US itself. Uh-huh, the US itself is an oil-producing country, SUDDENLY.
      Second, technology and equipment. As well as spare parts and maintenance of this equipment.
  8. Old Horseradish
    Old Horseradish 24 November 2022 19: 40
    "Russian oil" is that such a joke? Actually, this oil is oligarchic. The rest get horns and legs.
    1. Beregovic_1
      Beregovic_1 28 November 2022 22: 30
      The controlling stake in the largest taxpayer in Russia - Rosneft - is in the hands of the state, that is, the income goes directly to the treasury. The remaining shareholders also pay a large percentage of excess income to the treasury. The largest shareholder after the state - British BP also pays taxes to our treasury, in addition, they are prohibited from withdrawing profits from the country. Most of the 15 largest backbone enterprises in the country are under state control, and the oligarchs own little there (except for Mordashov and his Severstal). We draw 1 conclusion: the treasury is filled with the largest backbone companies. If you look at the structure of the budget, you can see that the social sector consumes about a third of our budget. This is more than in most countries of the world. We draw 2 conclusion: the oligarchs feed us with you. They, unlike us, do not hide from taxes and bring more benefits to the country, as the industries have preserved, built their business into the world's global supply chains, put the West on a needle. Foreign assets, palaces and yachts were squeezed out of them. What are their claims?
  9. Ivanushka Ivanov
    Ivanushka Ivanov 27 November 2022 23: 00
    We think too well of the Indians. I find their "bold" behavior too suspicious. And too relaxed reaction to this "partners".
    IMHO, the Indians play the role assigned to them (by the West), I must say, they combine business with pleasure. For, of course, to take Russia stupidly out of the game means to provoke a shortage of oil and an increase in its price. But as soon as global consumption is a value that is generally constant, oil flows can be redirected.
    Buying oil from Russia - India, therefore, will no longer buy somewhere. And there / somewhere / there will be no pressure and the price will start to fall.
    At the same time, India will begin to put pressure on Russia for maximum discounts "for the danger", "there is nowhere for you to go." And this discount will start to drive down the price of oil elsewhere. As a result, the price of Russian oil will fall below 30 dollars.

    Therefore. As soon as restrictions are introduced, Russia should reduce total exports by 30-50 percent. In this case, there is a high chance that oil revenues will remain at an acceptable level in Russia.

    In a good way, it is necessary for its consumers to put oil / gasoline / low prices - to stimulate our economy. But this, unfortunately, is not about our country.