Do you think the world can exist without Russian gas and oil?
Many people in the world believe that the world can exist without russian gas and oil. But how about you?
Russia is a major part of the global energy system thanks to its huge fossil fuel resources. It is the world’s third largest oil producer after the US and Saudi Arabia, accounting for 12% of global output, and the second largest gas producer after the US, responsible for 17% of the global output.
Replacing Russia’s share of world supply would be challenging even in a best-case scenario. An optimistic scenario would include higher output from US shale, OPEC nations and countries currently subject to US sanctions such as Venezuela and Iran. But much of that increased output would require further investment and much more time.
Russia’s power on the world stage is supported by its vast reserves of oil and gas. Since the invasion of Ukraine, Western countries have stepped up sanctions, including initial efforts to ban some of Russia’s oil exports. But expanding and enforcing an oil embargo will have wide-ranging consequences—on all sides.
Many people in the world fear that the world could eventually exist without russian gas and oil.
At the same time, the Kremlin is using the global energy crisis it has created to prop up its economy in the face of tough international sanctions. Moreover, it is arming Europe's reliance on Russian gas in an attempt to crush Western resistance to its ambitions in Ukraine.
Even before the war, the oil market was in short supply. Now they are slipping further into the deficit. In Western European countries, environmental laws and regulations have hindered the growth of private sector oil and gas supply, while in the United States, higher capital costs and a focus on higher production have also limited new supply. result? Markets are more nervous and volatile. If Russian oil disappears from the market under these restrictions, it will be difficult to find enough new sources in the short term to fill the gap and prevent oil prices from rising sharply.
Europe's dependence on Russian oil remains deep. Even if EU countries agree to the ban, Russia will have other buyers willing to buy the oil - notably India, the world's third-largest oil importer, which already buys Russian oil at a steep discount compared to other types of oil.
Most people in the world don't think that the world can exist without russian gas and oil.
Europe has diversified its natural gas imports. In 1990, Russia provided nearly 60% of EU imports. Right now it's about 40% (just 30% for a short time). However, a drop in EU production has dampened these gains. As a result, the share of Russian gas in total *consumption* is higher than ever.
Some politicians have linked this to calls to increase domestic fossil fuel supplies to reduce demand for Russian imports. Meanwhile, climate skeptics have made domestic oil and gas their sole focus, and in some cases even see clean energy as part of the problem.
Geographically, emerging markets are expected to be the main drivers of global oil demand going forward. Its growing population and transportation sector, coupled with reduced investment in clean energy, means there are few alternatives to oil.