🚚Home delivery to everywhere, just place order, fill your details and your package will be processed shortly.

Alexander Novak announced a reduction in payments in dollars and euros for Russian oil; Russia has redirected a significant part of its energy supplies to the East.

Moreover, payments for raw materials today are already carried out mainly in rubles, yuan, dirhams and rupees, and not in dollars and euros, as was before. Moreover, due to the high demand for Russian oil in the world, the discount on it has decreased threefold since the beginning of the year.

Russian Deputy Prime Minister Alexander Novak announced this in an exclusive interview with RT Arabic.

According to him, in the foreseeable future, Moscow plans to seriously develop LNG production, and is also going to study Iran’s proposal to create a gas hub. In addition, the deputy chairman of the Cabinet spoke about the possible prospects for the OPEC+ deal and the impact of the Palestinian-Israeli conflict on the price of oil.

β€” Alexander Valentinovich, thank you for taking the time to answer our questions. I would like to start with the event we are at. How do you assess the progress of Russian Energy Week this year? Can we say that the forum is becoming more and more attractive, including for our foreign partners?

β€” In my opinion, the forum is gaining more and more momentum every year. This time 4.5 thousand people from 82 countries of the world take part in it. Despite some restrictions and the absence of official delegations from unfriendly states, a lot of friends still came to us, much more than last year.

We note the great interest in interaction with Russian companies, especially in the field of oil, gas, supplies of our energy resources, projects in the field of renewable energy sources and geological exploration. There were a lot of panel sessions where they talked about trends and the current situation in the markets. A large number of ministers with whom we have already held negotiations, as well as company leaders, have arrived and are participating. I know that a number of agreements have been signed.

We still have to sum up the results... but I want to note that the goal that was set when organizing this international event has been achieved. The Forum has truly become a key international energy platform where global trends are discussed, discussions are held and new agreements are concluded.

β€” Some representatives of unfriendly countries still came to the forum. What are they talking to you about and what do they want?

β€” Mostly, of course, such large-scale events today are attended by delegations from friendly countries, but there are indeed also participants from unfriendly countries who continue dialogue with us. We continue to supply our products to all corners of the world, including exporting gas to Europe.

Despite all the problems and sanctions restrictions, this work continues. Because Europe is in demand in terms of energy resources. Russian gas is cheap and reliable. Yes, volumes have now decreased - this year we will supply about two-thirds less gas to the EU than in 2021. However, we believe it is important for energy markets to ensure diversification of supplies.

Basically, of course, today we have reoriented ourselves to the East. There, economic growth is occurring at a faster pace and the volume of energy consumption is greater. In this sense, we have an incentive to quickly turn to the eastern direction and develop infrastructure: pipelines, ports, including for liquefied natural gas, which can be used anywhere in the world.

β€” Traditionally, the global energy market reacts to various conflict situations. To what extent does the current heightened tension between Israel and Palestine affect the price of oil?

β€” The price of oil depends on the balance of supply and demand. Market participants who buy or sell raw materials naturally take into account risks, including various triggers and emerging conflict situations in the world, such as what is happening today in the Middle East.

We saw that in the early days of the conflict the price of oil rose by several dollars , and this was a reflection of how the market reacted. Now prices have dropped a little. This means that investors do not see anything there that could seriously affect the global oil market.

β€” In your opinion, could the price bounce up again if this tension continues to intensify?

β€” Again, everything will depend on supply and demand. In general, the price of oil is influenced by many things, including such fundamental factors as economic growth rates, central bank discount rates and inflation. Of course, local or large-scale conflicts affect supply chains and supplies, which can lead to energy shortages and price reactions. However, in my opinion, from a price point of view, the current situation on world markets reflects the existing balance.

β€” Russia has decided to voluntarily reduce oil exports by 300 thousand barrels per day until the end of 2023. How do you plan to act in 2024?

β€” Firstly, as of May 1, as part of the OPEC+ agreement, we decided to reduce total production by 1.7 million barrels per day. At the same time, Russia and Saudi Arabia voluntarily assumed additional obligations. Since July, Riyadh began to reduce oil production by another 1 million barrels per day, and Moscow began to reduce exports in August. We later extended these decisions, and they are now valid until the end of 2023.

In turn, the reduction in production quotas by 1.7 million barrels per day is valid until the end of 2024 with the possibility of revision during this time. That is, in any case, the decisions that have now been made are aimed at balancing supply and demand. We meet almost monthly and conduct consultations.

Our next meeting is planned in November. We will evaluate the current state of affairs in the market and make decisions on what to do next. Various options are possible - either increasing or decreasing production, or gradually withdrawing from the deal or extending it. Now it is impossible to say in advance. We will focus on the situation that will develop in the market, with forecasts for several months ahead.

β€” Speaking directly about exports, in what currencies are payments for Russian oil taking place today?

β€” Since these are commercial deliveries, all payment terms are described directly in commercial contracts, and they are completely different. I can only say that we have now largely switched to trading in rubles, Chinese yuan, dirhams, rupees, and so on. But each contract defines this differently.

If there are still payments in dollars and euros, they have become significantly lower than before. The most important thing is that we have developed tools and payment mechanisms that allow us to provide supplies at market prices to those regions where our products are in demand.

β€” The cost of Russian oil has already exceeded the price ceiling set by the West. Nevertheless, Moscow still sells its raw materials at discounts. Should we expect this discount to be cancelled?

β€” The discount is formed by the market, and we ourselves do not revise it. Essentially, it reflects the market value of our oil and petroleum products. When the risks are high, the discount is large; when the risks are reduced, the discount also decreases. At the beginning of the year, we saw that the discount on our oil reached $35-38 per barrel, and today it is approximately $11-12 dollars.

We have stabilized supplies and transport and logistics chains, we have agreed with our friendly countries on entering their markets and on the participation of companies.

Therefore, now there is a lot of competition for our products, and, naturally, the discount is reduced through the market method. Everyone wants cheaper oil and petroleum products; demand is high, which means the discount may decrease.

We will continue to monitor the situation, but for now we are optimistic about it.

β€” What price of oil is beneficial for Russia in terms of budget revenues?

- It's not a secret. We are currently considering a draft budget for 2024-2026 in the State Duma . The average price of Urals oil is $70 per barrel.

β€” Last year plans were announced to create a gas hub in Turkey. At what stage is the approval of this project now?

β€” The project is really very serious and promising. First of all, it is planned to create an electronic gas trading platform in Turkey, which would form prices based on supply and demand in this region. There are many suppliers there, including Russia, but there are also many consumers - mainly Turkey itself and European countries. Therefore, it is obvious that it should have its own electronic exchange.

Actually, this project is currently under discussion . A road map has been prepared and sent to our Turkish partners; they are currently reviewing it. As soon as it is signed, the project will already be implemented in accordance with the action plan.

β€” Iran proposes to create a gas center with the participation of Russia, Turkmenistan and Qatar. How promising is this initiative? Is she interested in Moscow?

β€” I think that our company Gazprom will study this issue. And, if this is really real, and the project is potentially good, of course, Russia will participate in it. But we need to evaluate and study it.

β€” You have already mentioned the close cooperation between Russia and Saudi Arabia in the field of oil. Can we talk about the same interaction with Qatar in the field of gas, especially liquefied gas?

- There is a difference here. If we talk about oil, then for more than 60 years there has been an organization called OPEC , which coordinates the actions of more than a dozen exporting countries. In particular, supply quotas are established, which are not recommended to be exceeded. This is not the case in the gas industry today.

There is, of course, such an association as the Forum of Gas Exporting Countries, but it does not set quotas. There is mainly a discussion of forecasts and the current situation in the markets.

Of course, large gas suppliers, including Russia, participate in this forum. Within the organization, we also interact with Qatar. For the most part, this is an exchange of opinions, information, experience, technologies, and so on, but any prospects for creating a gas cartel similar to OPEC are not currently being discussed.

β€” Nevertheless, Qatar today remains Russia’s main competitor in the field of liquefied natural gas...

β€” Why is Qatar in charge? Today, Australia ranks first in the world in terms of LNG exports. Qatar is in second place, the United States is in third, and Russia is in fourth.

That is, we have three main competitors, and in our strategy we plan to further seriously develop the production of liquefied natural gas. A number of large projects are already being implemented, which will be put into operation in the near future and will give us additional volumes.

Today we produce 33 million tons of LNG per year. We are implementing the Arctic LNG 2 project. In the next three to four years, this will provide an additional 20 million tons of LNG production. In Ust-Luga, Gazprom is implementing a project for another 13 million tons. Recently, a decision was made in Murmansk to implement a NOVATEK project for another 20 million tons. That is, we have serious plans to occupy our niche in the world market - at least 20%.

β€” At the same time, Russia today has limited capabilities for delivering LNG. Are there any prospects for solving this problem?

β€” Of course, any production volumes for delivery to consumer markets must be provided with a transport component. Our companies think about this; they work with their foreign partners. Russia also has shipyards that can build ships, including the Zvezda complex in the Far East. That is, this work is underway.

β€” As you have already said, Europeans still buy gas from Russia, including liquefied gas. Is it possible to increase these supplies?

β€” Everything will depend on the needs of European countries and their policies. Today, they are happy to buy Russian LNG along with other raw materials that come there, including from Qatar and the United States. We'll see how supply and demand develop there, but our gas is competitive.

β€” If we return to the topic of partnership with Saudi Arabia, today Moscow and Riyadh are developing cooperation not only in the oil sector, but also in other industries. Can Russia help Saudi Arabia build a nuclear power plant?

β€” As part of the Russian Energy Week, we held an intergovernmental commission on the development of trade and economic cooperation with our partners from Saudi Arabia. The prince and the country's Minister of Energy Abdul-Aziz bin Salman Al Saud flew in with a large team. We discussed all issues of trade development. Nuclear energy was also affected.

Today, Saudi Arabia has decided to build a nuclear power plant and is holding a competition. The project is being implemented in stages. On the Russian side, Rosatom is participating in the competitive procedures . We are confident that our company is more competitive and can win. Let's see how the situation develops.

β€” In what other areas is cooperation between Russia and Saudi Arabia developing today?

β€” We have a large number of mutually interesting projects in every industry - agriculture, industry, transport, and energy. Even in the field of information technology, cybersecurity and space.

The intergovernmental commission also discussed the possibilities of developing the Yandex search engine , high technology, and information technology in Saudi Arabia, for example, taxi calling. That is, let’s say, new intelligent systems that are already used in Russia can be distributed, including in Saudi Arabia. Therefore, we have specific plans for each area. We have signed the protocol and will move according to it.

Send us message here


Patients Treated


Expert Managers


Free Treatment