Lower Russian output as a result of its invasion of Ukraine will not leave the world short of oil, according to the International Energy Agency (IEA), as supply ramps up elsewhere and Chinese lockdowns dampen demand.
“Over time, continuously growing volumes from OPEC+ and the United States, along with a slowing in demand growth, are likely to fight off a severe supply shortfall amid a deepening Russian supply interruption,” the IEA stated in its monthly oil report.
Slower product exports and dropping domestic demand as a result of sanctions resulted in over a million barrels per day (bpd) of Russian oil being shut in last month – almost half a million bpd less than the Paris-based organization predicted last month.
According to the IEA, that amount will rise to 1.6 million bpd in May, 2 million in June, and over 3 million from July onwards if sanctions hinder additional purchases or expansion.
Nonetheless, Russian exports increased by 620,000 bpd in April from the previous month to 8.1 million bpd, returning to the January-February average as Russian production is diverted away from the US and Europe and mostly to India, according to the IEA.