Back$100 oil is quite possible, says Russian President Putin
He further said that Russia is ready to deliver all of the natural gas that Europe needs
PremiumRussian President Vladimir Putin on Wednesday said oil prices of $100 per barrel is quite possible.
He further said that Russia is ready to deliver all of the natural gas that Europe needs.
Europe’s largest gas supplier is raising deliveries in line with requests from its customers and is “prepared to discuss any additional steps" to stabilize the region’s markets, Putin said at Russia Energy Week in Moscow on Wednesday. However, he also criticized the continent for introducing “systematic flaws" into its energy system then “blame shifting" when things went wrong.
Russia already boosted gas shipments to Europe by 15% in the first nine months of the year, and “if we are asked to increase more, we are ready," Putin said. “We increase as much as our partners ask us to. There is not a single refusal, not a single one."
A spike in gas and power prices is wreaking havoc in Europe’s economy. Putin’s first verbal intervention into the market last week eased the rally, but prices have recovered slightly since. Dutch front-month gas, the European benchmark, advanced as much as much as 8.9% to 93.35 euros a megawatt-hour on Wednesday.
With the region’s own gas production declining and competition with Asia for liquefied-gas cargoes toughening, extra volumes from Russia this winter could offer some relief. While state-run gas giant Gazprom PJSC has been fulfilling all of its long-term supply contracts, it has been delivering less than customers in Europe would have wanted, leaving their gas inventories very depleted.
Putin said European customers made a mistake by relying on supplies from the short-term market to fill their gas storage facilities, instead of securing long-term contracts. Reserves supplies of energy are even more important as the proportion of weather-dependent wind and solar power increases, he said.
“The European gas market does not look to be well balanced and predictable," Putin said in a speech at the conference. In Russia’s domestic market “such problems are impossible to imagine."
While Gazprom’s production last month was at highest in more than a decade for this time of year, its exports to key foreign markets were lowest since at least September 2016, based on historic data and calculations compiled by Bloomberg and Interfax. The producer said it was overwhelmed by domestic demand, in large part due to a massive storage-injection campaign at home and cold September weather in several regions.
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