Over 60% of Russia‘s Energy Exports Now Go to the Asia-Pacific Region, Russian President Vladimir Putin announced at the Russian Energy Week plenary session.
“In the past, the Asia-Pacific region accounted for approximately 39% of our energy exports, but by the end of last year, this figure had increased 1.5 times and now exceeds 60%”, the Kremlin leader noted.
Since the start of the war in Ukraine, Russia has ramped up its oil and gas exports to countries like China, India, and Uzbekistan.
Putin also pointed out that “friendly countries now account for more than 90% of Russia’s energy exports,” alluding to the significant reduction in supplies to Western countries that have imposed sanctions on Russia.
Russia’s Energy Exports
Furthermore, Putin assured that 40% of foreign trade operations are now conducted in rubles.
Putin acknowledged that there are “challenges” in making payments for Russian exports due to Western sanctions, but expressed confidence that Moscow’s partners are eager to find solutions through transactions in national currencies.
“We are aware of these challenges and are addressing them gradually,” Putin assured the attendees at the Energy Week plenary session, which included the President of Guinea Equatorial, Teodoro Obiang, and the Venezuelan Vice President, Delcy Rodríguez.
The Russian leader reaffirmed that all the tasks facing the Russian energy sector will be accomplished, and the country will remain committed to its obligations to its partners.
“Russia is fulfilling its obligations to supply energy resources to the global market, playing a stabilizing role in it, and participating in prestigious formats such as the OPEC+ and the Forum of Gas Exporting Countries,” he emphasized.
In addition, Putin instructed the Government and the gas giant Gazprom to develop a “development plan” for the next ten years, which takes into account the redistribution of Russian fuel supply routes due to sanctions related to the war in Ukraine.
“I request that the company (Gazprom) work with the government to prepare a ten-year plan, the implementation of which will undoubtedly ensure the sustainable development of the corporation and the creation of infrastructure to change the geography of supplies,” he stressed.
Putin also addressed domestic energy consumption in Russia, which has surpassed the levels of the Soviet era.
“According to last year’s results, the volume of energy consumption in Russia has set a new record, exceeding the indicators of the Soviet period,” Putin said, adding that this is a sign of the country’s economic growth.
Analysis: Russia’s Shift in Energy Export Strategy
Russian President Vladimir Putin’s recent announcement at the Russian Energy Week plenary session that over 60% of Russia’s energy exports now go to the Asia-Pacific region marks a significant shift in the country’s energy export strategy [[1]]. According to Putin, this figure has increased by 1.5 times from the previous 39% and is a result of Russia’s efforts to diversify its energy exports.
This development is not surprising, given the current geopolitical tensions and sanctions imposed on Russia by Western countries. Since the start of the war in Ukraine, Russia has been actively seeking alternative markets for its energy exports, and the Asia-Pacific region has emerged as a key destination. Countries like China, India, and Uzbekistan have become major recipients of Russian oil and gas exports.
The significant reduction in supplies to Western countries is also a result of these sanctions. As Putin pointed out, “friendly countries now account for more than 90% of Russia’s energy exports” [[1]]. This suggests that Russia is prioritizing exports to countries that have not imposed sanctions on it.
Interestingly, Russia’s natural gas exports have dwindled by an estimated 42%, while crude oil exports have exceeded the volumes of 2021 [[2]]. This shift in export strategy is likely a response to the changing market dynamics and the need to adapt to new realities.
In another development, Putin announced that 40% of foreign trade operations are now conducted in rubles [[1]]. This move is likely aimed at reducing Russia’s dependence on the US dollar and promoting the use of its national currency in international trade.
While Putin acknowledged that there are “challenges” in making payments for Russian oil and gas exports, the country’s energy sector has shown resilience in the face of sanctions. Russia’s revenue from coal exports reached EUR 60 million per day, while pipeline gas export revenues increased by 4% month-on-month to EUR 65 million per day [[1]].
Russia’s shift in energy export strategy is a response to the changing global market dynamics and the need to adapt to new realities. The country’s efforts to diversify its energy exports and promote the use of its national currency in international trade are likely to continue, as it seeks to reduce its dependence on Western countries.
References:
[[1]]https://energyandcleanair.org/april-2024-monthly-analysis-of-russian-fossil-fuel-exports-and-sanctions/
[[2]]https://www.energypolicy.columbia.edu/publications/russias-gas-export-strategy-adapting-to-the-new-reality/
[[3]]https://www.eia.gov/todayinenergy/detail.php?id=55021
