the production of “pariah” states at the highest

2023-05-18 10:27:00

Is this a sign of growing oil needs in the world? The countries under sanctions, Russia, Iran and Venezuela, are currently showing high levels of production. Their status does not subject them to a quota within the framework of the OPEC+ partnership, and these countries have a client that is thirsty for oil and is hardly aligned with the Western camp: China.

Exports at a record level

Despite the price cap of 60 dollars per barrel of crude and the European embargo, Russia continues to extract its black gold at full speed, at 9.6 million barrels per day (mb/d), casting doubt on its announcement to officially lower its flow by 500,000 b/d, in response to the sanctions. This explains why in April its exports reached their highest level since its military invasion of Ukraine in February 2022, posting 8.8 mb/d, which brought in 15 billion dollars, or 1, 7 billion dollars more compared to March, according to figures published in its monthly report by the International Energy Agency (IEA).

The discounted prices charged by Russian companies have found outlets in China, India and Turkey, which are buying record volumes. Chinese demand continues to increase since the end of the period of confinement imposed by the “zero Covid” policy. In March, the Asian giant, which is also the world’s largest oil importer, saw its demand reach a new historic peak at 16 mb/d, according to the IEA.

The Agency has also raised its forecast for global demand for 2023 to 102 mb/d, i.e. 2.2 mb/d more than in 2022, which in this case also represents a historic consumption record.

Russia is not the only country under sanction to increase production and sales. Iran pumped 2.75 mb/d in April, its highest volume in three years. “Exports, mainly to China, remained robust, local consumption increased, thanks to the modernization of the Abadan refinery, and a large volume was stored”explain the experts of the IEA.

Iran is also accused of exporting some 16 million barrels to Syria in recent months, despite sanctions, worth nearly $1 billion. according to the Israeli daily Haaretz.

Russian investments in Iranian oil

And the country intends to develop its extractions. “Russia is investing in 6 Iranian oil fields”, said this Wednesday Javad Oji, the Iranian Minister of Petroleum, during a signing in Tehran of an agreement between the two countries relating to a corridor linking the two countries. A railway line will be built between the city of Rasht in northeastern Iran and Astara on the border with Azerbaijan, on the Caspian Sea, according to AFP.

For Moscow, this infrastructure is part of the project to develop a North-South corridor, via a network of maritime, rail and land routes 7,200 km long, which aims to redraw the circuits of globalization and counter Western hegemony. in the transport of goods.

As for Venezuela, despite the sanctions, it pumped 780,000 bpd in April, its highest level since the end of 2021 and is increasing its exports, particularly to China. Washington authorized in November the American major Chevron to operate once more in the country via a joint venture. “Chevron produces some 100,000 b/d, but has indicated that it can increase this volume by 50% this year”, reports the IEA. With Uncle Sam participating in the revival of the Venezuelan oil industry, this shows that the world of black gold is subject to significant change.