Stakeholders Deliberate Alternative to Russia as Oil Prices Soar

Stakeholders in global Oil and gas markets have advocated a combination of more fossil fuel production and renewable energy sources to enable less reliance on Russia as oil prices soared following the country’s invasion of Ukraine.

The deliberation occurred at an industry conference held on Monday, 7th March at the CERAWeek energy conference in Houston. This is also remarkably happening on a day when global oil prices claimed to levels described as ‘the highest since the 2008 financial crisis.’

Globally, buyers and oil companies are exiting trading with Russian crude and fuel. These exits have been projected to lead to what could be the biggest disruption in the global energy supply in decades.

Russia is said to exports 4 to 5 million barrels of crude and 2 to 3 million barrels of products daily.

Speaking about this update, OPEC Secretary-General Mohammad Barkindo said: “This is about how we survive this crisis. There is no capacity in the world in the moment that can replace 7 million barrels of exports.” 

According to stakeholders, the CERAWeek Energy Conference was supposed to focus its agenda on energy transition technologies and a greater role for renewables. However, many participants have focused on energy security and reliability on Russia’s oil and gas exports – especially European countries.

Speaking about the shift in its direction, Andy Brown, CEO of Portuguese energy company Galp, said: “The Portuguese government was discussing how we can accelerate renewables in Portugal. Even before the Russian situation emerged, the market was distressed. Take Russia (energy) out of the equation, then it becomes a crisis.”

The OPEC Secretary-General also emphasised the need for further global investment in oil and gas and how the lack of investment in the previous years has affected everyone globally.

Investors King reported that Shell PLC has only recently disclosed that it will no longer be buying from Russia nor will it continue to operate its facilities there – making it one of the major oil and gas companies to pull out from Russia. TotalEnergies, although having disclosed that it will no longer continue with Russia, still have some Russian crude oil delivered to it via one of its landlocked refineries in Germany.