Russia is the global liquids balance wildcard, with some of the lowest cost onshore production outside of the main OPEC members, how much supply they keep on the market in 2023 and beyond is perhaps the most important factor that will decide the trajectory of the global crude curve.
For over a year we have heard about the serendipitous drop in Russian production that will lead to sky high oil prices. I would suggest there is a chance that may not be the case. Of course, it would be all but impossible to give a definitive direction as to Russia’s liquids production, and doubly impossible to predict how oil prices may respond to whatever happens — though there are some missed Russia themes that people have misused (misinterpreted, perhaps) to argue that production should decline steeply (of course leading to high oil prices).
Russia has disappointed the bulls, and in my view, will continue to disappoint those looking for large drops in production volumes, and export loadings. I hear ofte…