How Important are Russian Oil and Gas:

Up to 40% of Europe’s gas comes from Russia, which has been a big topic of conversation during the colder winter months. When the weather gets warmer and we don’t need gas as much, it’s important to remember that crude oil and other petroleum products aren’t all that different. Russia is the second largest exporter in the world after Saudi Arabia. It sends out about 5 million barrels per day. We are one of the well-known bitumen supplier along with the supply of Russian crude oil all on our website online.

About half of it goes to the EU, which gets 27% of its imports and 15% of its total needs from Russia. The UK is less reliant on oil from Russia. In 2021, the UK imported 4.7 million tonnes of oil from Russia, which was just under 100,000 barrels per day and less than 10% of its oil needs.

Replacement:

To solve the gas problem, we need to increase production from other places, reduce demand, buy more liquefied natural gas (LNG), and work harder on renewable energy and nuclear power.

Adding oil to the deal will only make things worse. Ole Hansen of Saxo Bank said, “Other producers can’t make up for a problem of this size, at least not in the near future.”

One idea being talked about is for the US to stop punishing Iran and Venezuela. Sophie Udubasceanu, a global crude oil expert at ICIS, said that Iran could add about 1.3 million barrels of oil per day to the market. But she warned that Venezuela’s contribution would only come if the country fixed its long-term problems with output.

How Much Higher Be Could the Price of Oil:

It depends on how things are in the world. In July 2008, it hit a record high of $147.50, and some analysts think it could go even higher.

Giovanni Staunovo, a commodity analyst at UBS, said that if the war goes on for a long time, the price could go up to $150 or more. Analysts at Bank of America said that if most of Russia’s oil exports were stopped, the 5m bpd shortfall could drive prices up to $200.

Possible Effects:

The price of everything, from gas at the pump to goods shipped by road, went up by a lot. This added to the sky-high inflation and the cost-of-living crisis.

A saying says that the best way to deal with high prices is to make them even higher. This is a reference to the idea of demand destruction. If oil gets so expensive that people can’t buy it, they stop, and the price goes back down. But that will probably mean things like shutting down factories, which will cause a big drop in economic activity and, very likely, a recession.