Moscow, December 25 (QNA) – Russian Minister of Finance Anton Siluanov announced that his country will search for new markets for Russian oil, away from the West and will also search for alternative logistics, even if it is more expensive, but it will not be subject to the price ceiling set by European countries.
Siluanov said, in statements reported by the Russian news agency (Sputnik), that Russia may have to limit the volume of production somewhere, and added: “We now see that our companies and oil companies are reorienting their supply lines from west to east and to other countries. We will look for new consumers of oil, as the demand for oil will increase according to the expectations of the agencies. We will search for new markets, and we will search for new logistics, and it may be more expensive.”
“This is what the consumer dictates through market methods,” he continued, stressing that price restrictions apply to Russian manufacturers.
Russia is facing an increasing package of Western sanctions, since the outbreak of the war in Ukraine last February, and the latest of these sanctions was what European Union officials approved on Dec. 3, setting a ceiling for the price of Russian crude at USD 60 a barrel, a decision according to which anyone who wants to obtain basic services provided by the European bloc, especially insurance, must pay this price or less.
According to the Russian Finance Minister, the price ceiling will certainly lead to price and market distortions.
The minister estimated oil prices in the budget at USD 70 a barrel, and USD 65 by 2025.
Siluanov considered that the United States is the primary beneficiary of Western sanctions, and that his country will not supply oil under contracts that set the ceiling for prices offered by Western countries, criticizing the sanctions imposed on Russian oil. He said that it is a “totally non-market measure”.
Oil and gas revenues in Russia’s federal budget constitute about a third of total revenues, according to the minister, who said that Moscow is very conservative about energy resource price indices when planning the budget, which it seeks to reduce its deficit to 2 percent of the Gross Domestic Product (GDP) next year, and less than 1 percent by 2025, while debt is currently about 18 percent of GDP. (QNA)