Business news from Ukraine

Business news from Ukraine

JPMORGAN ANALYSTS: IF RUSSIA CUTS SUPPLIES, OIL COULD SOAR TO $380 PER BARREL

Oil prices could soar into the stratosphere and reach $380 per barrel in a worst-case scenario in which Russia cuts fuel supplies in response to Western sanctions, J.P. analysts predict. Morgan Chase & Co.
The Russian Federation can afford to cut production by 5 million barrels per day without causing excessive harm to the economy, Bloomberg quoted bank analysts as saying. Moscow may take such a measure due to various possible measures by the West, including imposing a ceiling on the price buyers pay for Russian oil.
At the same time, the consequences of such actions for the rest of the world will be catastrophic. A 3 million bpd production cut would push Brent oil prices up to $190 per barrel, while in a worst-case scenario, if production falls by 5 million bpd, prices will soar to $380 per barrel, experts say.
“The most obvious and likely risk associated with imposing a price cap is that Russia may decide not to participate in this scheme and instead retaliate by cutting exports,” the analysts wrote. “It is likely that the government may retaliate by cutting production to harm the West. The lack of supply in the world oil market is playing into the hands of Russia.”
September futures for Brent crude on the London ICE Futures exchange by 10:23 Moscow time are trading at around $111.8 per barrel, futures for WTI oil for August on the New York Mercantile Exchange (NYMEX) by this time are about $108.6 per barrel. barrel.

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G-7 COUNTRIES PLEDGE TO PHASE OUT RUSSIAN OIL IMPORTS

The G7 countries have committed themselves to phase out or ban the import of Russian oil, according to a statement posted on the White House website on Sunday.
“This will hit the main artery of Putin’s economy hard and deprive him of the income he needs to finance the war. The G7 also committed to working together to secure stable global energy supplies while stepping up our efforts to reduce dependence on fossil fuels.

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UKRAINE TO CONTINUE SEEKING FOR IMPOSING OIL EMBARGO ON RUSSIA

The leadership of Ukraine will continue to seek the introduction of an oil embargo on Russia.
“Unfortunately, we have not reached the oil embargo yet. We will continue to work to convince our partners of the oil embargo,” the head of the President’s Office wrote on Tuesday in his Telegram channel.
Thus, he commented on the introduction by the European Union of the fifth package of sanctions against the Russian Federation.
Earlier, President of the European Commission Ursula von der Leyen announced proposals for new sanctions of the fifth EU package against the Russian Federation.

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UKRNAFTA INCREASES OIL WITH CONDENSATE PRODUCTION BY 5.6%

In January 2022, PJSC Ukrnafta increased oil and condensate production by 5.6% (by 6,900 tonnes) compared to the same period in 2021, to 130,500 tonnes, the company’s press service reported on Monday.
According to it, gas production increased by 3.6% (by 3.3 million cubic meters), to 94.5 million cubic meters.
In addition, production of liquefied gas in January 2022 at the company’s plants increased by 10% (by 990 tonnes) compared to January last year, to 10,870 tonnes.
Ukrnafta clarified that the increase in production is associated with efficient operation of the existing well stock and a reduction in equipment downtime. In addition, commissioned oil well No. 103 at the Verkhnomaslovetske field (Lviv region) had a positive effect on production activities.
“Ukrnafta is making efforts to increase hydrocarbon production, particularly of natural gas. This is an important task both in terms of supplying the domestic market with natural gas during high seasonal demand and for strengthening the country’s energy independence in the long term,” the company said.
Ukrnafta owns 85 special permits for production of hydrocarbons, and has 1,809 oil and 153 gas wells on its balance sheet. The company owns 537 filling stations.
NJSC Naftogaz Ukrainy owns 50% plus 1 share of the largest oil producing company in the country, and a group of companies associated with the former shareholders of PrivatBank owns about 42% of the shares.

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UKRAINE PREPARES DECISION IN RESPOND TO OIL PRICES INCREASE

Ukraine is preparing decisions in response to the rise in world prices for oil and, accordingly, for petroleum products, First Deputy Prime Minister Yulia Svyrydenko stated.
“Now we see that oil prices are rising at a fast pace, followed by rising prices for petrol and diesel fuel in Ukraine. The government will make the necessary decisions, we are now developing a comprehensive plan to stabilize the situation,” she said during a meeting of the Congress of Local and Regional Authorities in Kharkiv.

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UKRAINES OIL IMPORT INCREASES BY 17.3% IN 11 MONTHS

Ukraine in January-November 2021 increased imports of oil and petroleum raw materials (according to foreign economic activity code 2709) by 17.3% (by 199,077 tonnes) compared to the same period in 2020 – to 1.350 million tonnes.
According to the State Customs Service, over 11 months, raw materials worth $ 694.733 million were imported, which is 1.8 times more than in January-November 2020 ($ 377.031 million), including from Azerbaijan – for $ 485.761 million, Algeria – for $ 100.146 million, Libya – for $ 92.303 million, other countries – for $ 16.523 million.
In addition, Ukraine in January-November 2021 exported 89,963 tonnes of oil to Romania for $ 27.133 million. This volume was exported in March by the international trader Trafigura. The resource was purchased from JSC Ukrtransnafta, which, in turn, in the spring of 2020 bought it at a decline in prices for subsequent resale.
The export of oil and crude oil by Ukraine in January-November 2020 amounted to 80,000 tonnes for $ 24.351 million. Exports were carried out to Belarus by Ukrtransnafta, which in the spring of 2020, amid the decline in prices, bought Azerbaijani oil with its subsequent sale to its subsidiary BNK.

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