Grandstand. The Russian Ministry of Energy estimated in March 2021, before the surge in crude prices and before the war, that Russian oil production risked never being able to return to its pre-Covid-19 level. In question: the drying up of many of the oil fields hitherto the most generous, located on both sides of the Urals, in Western Siberia and in the plain of the Volga. About half of Russian crude production comes from so-called “mature” fields, whose production is doomed to decline. On the natural gas side, half of the production is also mature, but the rate of depletion appears less abrupt.
The development of intact resources, particularly in Arctic Siberia, is therefore vital for the regime in place in Moscow, which derives two-thirds of its foreign exchange resources and half of its tax revenues from hydrocarbons. A bit like a bathtub emptying on one side and having to be filled on the other, Russia needs to maintain massive, costly and increasingly technical investments, particularly in the Arctic, in eastern Siberia and in sea, in the hope of preserving its oil and gas windfall in the years to come.
If it persists, soaring energy prices will make it easier for Russian and foreign companies to continue to work together. Rosneft, Gazprom, Lukoil and Novatek control most of the country’s hydrocarbon production, but they need expertise, capital, spare parts and equipment from elsewhere.
But the path of the West seems to be closing. BP has announced that it wants to sell its shares in Rosneft. The Norwegian Equinor wants to do the same. The American giant Exxon is preparing to interrupt its operations in Russia. A shareholder of Novatek and established in particular in the Arctic in the Yamal peninsula, TotalEnergies is content for the moment to say that it “will not invest in new projects”but will he be able to stick to this status quo?
Moscow turns to Beijing
The Kremlin necessarily anticipated the consequences of the war. The former KGB who hold Moscow have probably not forgotten how the United States and its Saudi allies were able to bleed the Soviet economy from 1986, thanks to the “oil counter-shock”. Vladimir Putin and his closest partner, Igor Setchine, boss of Rosneft, have long been exploring the possibilities of a change of partners. In 2020, Mr. Setchine’s right-hand man, Didier Casimiro, castigated the desire displayed by the European majors present in Russia to divest from crude extraction: “It’s an existential threat to production. (…) You will have a contraction in supply, and higher and more volatile prices. » He then warned: “Someone will have to take their place. »
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