China’s consumption and the impact of sanctions on Russia
Global oil prices have risen over the past two weeks, approaching $90 a barrel, as China – the world’s largest oil importer – abandons the strict restrictions it has implemented to combat COVID-19 for nearly three years. However, the recovery path remains uncertain, as Beijing faces a resurgence of virus cases, prompting the Organization of the Petroleum Exporting Countries and its allies to remain on guard.
Meanwhile, OPEC+ is waiting to see the full impact of European Union sanctions on Russia, a member of the alliance, over its invasion of Ukraine, as measures targeting its sales of crude oil took effect in December, and restrictions on its trade in refined products will also be applied. next month, but Russian shipments have been surprisingly resilient so far.
India’s purchases of Russian oil jumped 33 times in December
Raad Al-Qadri, an analyst at the Eurasia Group, a consultancy, said in a report: “It seems increasingly likely that (OPEC +) will maintain production levels unchanged, even after the upcoming meeting … prices have held together, and supply remains scarce.” Great levels of uncertainty prevail in both supply and demand.--
The decision of the Joint Ministerial Monitoring Committee to maintain production levels at their current levels, when it convenes online next week, will be consistent with the signals of senior officials of the Organization of the Petroleum Exporting Countries (OPEC).-
OPEC Secretary-General Haitham Al-Ghais said earlier this month that he is “cautiously optimistic” about the global economy, as an emerging recovery in China will mitigate the impact of weakness in advanced economies. For his part, Saudi Energy Minister Prince Abdulaziz bin Salman insisted last month that OPEC+ would be “proactive and cautious” to keep the markets balanced.
Helima Croft, head of commodity strategy at RBC Capital Markets, said: “All indications are that Saudi Arabia is seeking to adhere to a precautionary policy for the time being and keep production restrictions in place until there are clear indications that there is sufficient demand for additional supply.