Mikhail Krutikhin: "Russia may refuse to export oil"

“Two or a year and a half ago, economists believed that what Russia had accumulated in the form of monetary, gold and foreign exchange reserves would be enough to be completely cut off from some kind of income, from the West, and stretch out for another four years. Here operated on with such a figure.

Now they say that since half, more than half of the gold and foreign exchange reserves are under arrest, there is no access to them, they are reducing this period. Someone says that, well, yes: enough for two months, someone - for a year.

But everything will depend on a lot of things. And from the intensity of the military special operation, the cost of it, and from some channels through which Russia still manages to receive both food and consumer goods.

Once again: I cannot predict the exact timing of the "collapse".

The sanctions are not as harsh as they might seem at first glance.

But with oil it will turn out much worse than with gas.

First, we see that it has become very difficult to sell oil from Russia not under long-term contracts, but through spot, auction deals, and so on. An auction is announced for six shipments of Russian oil, but no one comes, is not going to buy this oil.

Psychologically, buyers are afraid of being sanctioned as "assisting Russia" in its war effort. The banks that have to lend to this deal, finance, open letters of credit, they don't want to do this in cooperation with Russian banks and in general with financial sanctions, so it becomes more and more difficult. Discounts do not even help, which in some cases amount not to 35, but even 40 dollars per barrel, such discounts are sometimes offered, but buyers are still not found.

And the fact that it is impossible to ship as much oil as Russian companies would like is already having very unpleasant consequences for the Russian oil industry and the entire Russian federal budget, because companies are now forced to give instructions in their fields to reduce production.

According to some reports, Russian oil production may fall by 25-30% this year. And when we ask the oilmen what will happen next year, they answer that next year we will see the figure of 50%.

But if Russia produces half as much oil as it does now, it will automatically fall out of the list of oil exporting countries. That is, there will be enough oil only for domestic consumption, and the currency for its sale abroad will simply cease to flow.”

You can listen to the entire conversation with Mikhail Krutikhin here.