Economics/Class Relations

How Stable Is the Russian Oil Industry?

by Peter Zeihan on February 14, 2023

The big news from the weekend is that Russia announced a plan to cut 500,000 b/d (barrels per day) of oil production. This accounts for about .5% of global supply and roughly 10% of Russian oil exports.

This alone isn’t a huge deal, but when you stack up all the factors working against the Russian oil industry, some concern over its stability is warranted. Struggling to break even, the potential of wells freezing and bursting due to crude flow disruptions, the Ukraine War…that’s a hefty list and it wouldn’t take much to throw everything into a tailspin.

I’m not sounding the alarm bells quite yet, but it’s a good reminder as to just how fragile this whole system really is.

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