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World will not run out of oil even with embargoes on Russian production, says IEA

The world will not be without Petroleum even with lower production from Russia, the International Energy Agency (IEA) said on Thursday (12), in a turnaround after predicting a possible “global supply shock” in March.

The IEA, after warning on March 16 that 3 million barrels a day could be closed starting in April, reduced that number for a second time as it noted that only 1 million barrels a day went offline.

Rising production elsewhere and slower growth in demand due to China’s lockdowns will prevent a large deficit, the Paris-based IEA said.

“Over time, steadily rising OPEC+ volumes in the Middle East and US, coupled with a slowdown in demand growth, are expected to stave off an acute supply deficit amid worsening Russian supply disruption.” , the IEA said in a monthly report.

The assessment suggests that the economic impact of new EU-considered Russian energy sanctions could be limited.

“Rising pump prices and slowing economic growth are expected to significantly dampen demand recovery for the remainder of the year and into 2023,” the IEA said, adding that restrictions aimed at containing Covid-19 in China are in place. causing a prolonged economic slowdown in the country.

Reflecting slower product exports and falling domestic demand, about a million barrels a day of Russian crude was closed last month — about half a million less than the agency previously predicted.

The IEA predicts that figure will rise to 1.6 million barrels a day in May, to 2 million in June and to nearly 3 million from July if sanctions prevent further purchases or expand.

The United States and other IEA members have pledged to release 240 million barrels of oil in their second access to emergency reserves this year, after the IEA failed to release a US-led statement in November because it did not see major supply disruptions in the country. era.

Russian exports rebounded in April by 620,000 barrels a day from a month earlier to 8.1 million, the IEA said, back to the January-February average as supply was diverted from the United States and Europe. , mainly to India.

While working on a ban on Russian oil, the European Union remained the main market for Russian oil exports last month, the IEA said, down by just 535,000 barrels a day since the start of the year.

The bloc now accounts for 43% of Russian oil exports, down from around 50% at the time.

Source: CNN Brasil

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