Here’s a disclaimer to the view in many quarters that Donald Trump is roiling the international oil markets by threatening penalties on countries buying sanctioned Russian oil:
Energy specialist Amit Bhandari of Gateway House in Mumbai says “If Russian oil exports were to suddenly stop or reduced massively, we would immediately get to see it in crisis. That is not happening.
“What these sanctions really meant was that, instead of, you know, suppliers supplying to customer B, the pockets shifted a little bit but the flows are pretty much the same. So, I mean, you know, whenever we hear about sanctions, it is more of the same. I would say. So there is no way you can stop the flow of Russian oil.”
Bhandari was a guest on The Gist, analysing the oil markets in the context of Trump’s threats. If the export of Russian oil stops, he said, the price per barrel could rise to levels that would be catastrophic for the world economy and also the US.
“When the price of oil goes up, it goes up for everyone. It is not that American consumers will pay less because oil is produced in America. It is a market driven price.”
In Bhandari’s view, Trump’s threats are intended to get India to concede ground elsewhere in the trade negotiations. India’s current oil consumption is around 5 million barrels per day, which is expected to rise to 12 million barrels, and since much of it is imported it is a major weakness. But there’s enough oil out there to ensure steady supply.
India’s other weakness is seeking to reduce the dependence on oil and turning to electric vehicles, where the dependence is on one country: China, for its rare earth ring magnets and so on. China has weaponised rare earths in the past, notably against Japan, and by all accounts it is doing the same vis a vis India.
Tune in for more in this conversation with Amit Bhandari of Gateway House.
Thirty eight years in journalism, widely travelled, history buff with a preference for Old Monk Rum. Current interest/focus spans China, Technology and Trade. Recent reads: Steven Colls Directorate S and Alexander Frater's Chasing the Monsoon. Netflix/Prime video junkie. Loves animal videos on Facebook. Reluctant tweeter.
