The share of the US oil on the market is being increased more via political rather than economic methods, Chief Executive Officer of Russia’s oil major Rosneft Igor Sechin told the 12th Eurasian Economic Forum on Thursday.
"The increase in the share of the US oil on the global market is often achieved not so much via economic as via political methods — by ousting key players and foisting products," TASS quoted him as saying.
Meanwhile, pipelines and port export terminals are being constructed actively in the US, which allows not only to satisfy the mounting local demand, but also to boost export flows, the CEO added. "At the same time, the question arises how justified those investments are and whether the resource base is sufficient for ensuring long-term supplies? The resource base of shale oil is not yet sufficiently explored and the expected slowdown in shale production growth rates may be related particularly to downward revaluation of the shale resource potential by companies," he noted.
The geography of crude supplies from the US is being expanded as well, Sechin stated. "Previously the US oil was mainly purchased by Canada [it accounted for 97% of US crude exports in 2001-2014], whereas after export restrictions were lifted at the end of 2015, more than 40 countries started buying the US oil. Europe accounted for over one fourth of supplies in January-July period of 2019," he explained.
Currently about one third of global crude reserves and one fifth of global oil production in Iran, Venezuela and Russia are restricted by American sanctions, according to Sechin. "Meanwhile the United States virtually extends its jurisdiction over other countries, including the European Union, which is forced to comply with the US’ sanctions policy," he said.
Iranian crude imports to the EU dropped by a third last year (by 32.3% from roughly 27.3 mln metric tons to around 18.5 mln metric tons) and have been going down in 2019 as well, Rosneft CEO elaborated. He added though that "the US increased its crude supplies to the EU 2.5-fold in 2018," and it is particularly the US that "became the key beneficiary of sanctions restrictions on the European market."