Russian Oil Export Resilience Amid Sanctions and Global Market Dynamics

Despite new US sanctions, Russian oil exports remain largely unaffected, helping stabilize the global supply of crude. Potential economic downturns and increased production from OPEC+ members could lead to further price declines, though market conditions are currently skewed toward a surplus.

Despite new US sanctions in January, Russian oil exports continue almost unaffected, defying expectations, as revealed by HSBC Global Research's latest report. Collaborations with India and China have minimized disruption, maintaining stable supply and cushioning the global market from potential shocks.

The report warns that the primary threat to crude oil prices lies in potential supply disruptions. These remain largely speculative, as stronger supply and weak demand growth persist, contributing to recent price declines. Brent crude is anticipated to average USD 73 per barrel in 2025 and USD 70 in 2026, though risks of further price drops are significant.

OPEC+ could intervene by pausing output cuts if prices fall into the mid-USD 60s, while continued overproduction from countries like Kazakhstan and the UAE stabilizes availability. A potential surplus looms, amplified by global economic slowdowns and lack of a mechanism to support prices, posing downside risks for future market stability.

(With inputs from agencies.)