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China The Bigger 2023 Oil Price Driver Than Russia: Energy Aspects

OIL

China will be the bigger price driver than Russia for oil prices next year, Energy Aspects Amrita Sen said in an interview with CNBC.

  • “China will be the bigger driver for 2023 prices…just because the swing of Chinese demand could be over 1mbpd, depending on the lockdowns. Back in April it was 2mbpd and Chinese buying has been extremely erratic, and our view has been already for some time that re-opening is really not going to happen until April, the very earliest”, she said.
  • “We are hearing the oil price cap will be around $65/bl and right now Russian crude Urals is trading at around $60/bbl or even slightly lower after today’s correction in flat price.”
  • “The price cap does not impact Europe’s ability to buy Russian oil. I think that is the problem and the confusion in the market. The issue is, remember the EU is coming up with the embargo on 5 December that supersedes the price cap. But the confusion in the market is, and particularly in the US, does this change your view on how much Russian oil can flow into Europe.”
  • “The price cap is about other countries, like in Asia. Europe is home to 90% of maritime services, so shipping, insurance… so that is why the price cap was always about the rest of the world’s ability to buy Russian oil.”

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