Demand for domestic oil and revenues from its sales could collapse, and the global economy could fall
The 14th package of EU sanctions will limit the access of tankers with Russian oil to European ports, the executive said duties of the Minister of Foreign Affairs of the Netherlands Hanke Bruins Slot. The restrictions will also make it possible to cancel all existing contracts for the supply of liquefied natural gas from Russia. What goals are the EU countries pursuing and what consequences does Moscow expect from the restrictions? Experts are convinced that the next sanctions will hit the global economy. It turns out that the Europeans started the mess, and everyone will have to clean up the mess.
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Artem Deev, head of the analytical department at AMarkets: “The 14th package of EU sanctions is aimed at further limiting Russian export opportunities and putting pressure on the Russian economy. Restricting the access of tankers with Russian oil to European ports reduces the export market for Russia, which reduces its income from oil sales.
For Russia, sanctions could lead to a drop in demand for its oil on the world market, leading to lower revenues. They will have to find alternative markets to sell their oil, which may be difficult and require a reorientation of the export infrastructure. Sanctions could have a further negative impact on the Russian economy, increasing inflation, reducing investment and limiting access to foreign technologies.
In turn, for the EU, sanctions could lead to higher oil and gas prices in Europe, increasing costs for consumers and businesses. Therefore, they will also have to look for alternative sources of energy supplies, which could lead to new dependence on other countries, for example, on the United States or the countries of the Middle East.
Thus, new sanctions could negatively affect the Russian economy, creating risks for global economy.
Sanctions are certainly a serious challenge for Russia. They limit its economic opportunities and make it more isolated in the international community. However, how scary they are depends on a number of factors, including the effectiveness of the Russian economy’s adaptation to new conditions.”
Andrey Loboda, economist, director of communications at BitRiver: “The new package of sanctions says only one thing: Russia did absolutely the right thing by starting to expand supplies of raw materials to Asia 2 years ago. Now no one will say that we should have waited or not rushed to change export sales routes. Europe will be left without Russian oil and gas. Apparently, there is extra money there to buy raw materials and petroleum products from the United States at much higher prices. And Washington is increasingly hooking Europe into dependence on the dollar and its exports. After all, the United States sells hydrocarbons and their derivatives exclusively for dollars to Europeans, while many countries are trying to refuse them in mutual settlements. The 14th series of horror stories is designed to have an informational effect against Russia, but economics and reason have not been taken into account by European officials for a long time.
Russia has not been afraid of such sanctions attacks for a long time. We were perfectly able to change our sales markets. Europe can ban everything; this will in no way stop the process of scaling Russian exports. Such prohibitions are more like shooting yourself in the foot. Western European neighbors have lost almost $1 trillion in two years due to reduced cooperation with Russia. The economy of energy shortage nullifies any attempt at an economic breakthrough by the EU.
It is high time for Russia to introduce a minimum level of purchase prices for its energy resources for the EU — it should be at least 15% higher than exchange prices with a ban on the re-export of Russian energy resources by third countries. Checkmate to Brussels.”