We won’t be without oil right away as Russia’s production decreases due to the war in Ukraine and sanctions against Moscow, the International Energy Agency (IEA) said on Thursday. There is less demand for oil worldwide and the oil countries in the Middle East and the US can take over part of the production.
Russia’s daily oil production fell by nearly a million barrels in April, according to the IEA. Because of the war, western countries are buying less and less oil from Russia and Russian oil companies are therefore reducing their production. Incidentally, Russia sold more oil to China and India, and oil is also still sold to the European Union. As a result, billions are still flowing into the Russian war coffers.
The IEA believes that Russian production will fall further this year as sanctions begin to weigh more heavily. From July, the agency expects that three million barrels less will be pumped in the country every day. The EU is working on a full boycott of Russian oil. Before the invasion of Ukraine, Russia’s daily production was about ten million barrels.
Global oil demand growth is being held back by the corona lockdowns in China, which means less oil is needed in that country. China is the world’s largest importer of oil. The IEA estimates average daily oil demand this year will be 99.4 million barrels. That is an increase of 1.8 million barrels compared to last year.
Member States of the IEA are also using their strategic oil reserves to bring more oil to the market and thus lower fuel prices at the pump.
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