Russia: OPEC+ Will Continue After UAE Exit, No Price War Expected

Russia's steadfast commitment to the OPEC+ framework remains unshaken, even as the United Arab Emirates makes its exit. Deputy Prime Minister Alexander Novak articulated a clear-eyed assessment of the global oil market, emphasizing that the current crisis, exacerbated by the U.S.-Israeli war against Iran and the subsequent closure of the Strait of Hormuz, has created a significant deficit. Novak rightly points out that in such a scenario, a price war is illogical; instead, the focus must be on addressing the imbalance between demand and supply. The departure of the UAE, while notable, does not alter Russia's strategic position within the alliance, which is crucial for stabilizing global energy markets. The market's recovery will undoubtedly take time, as Novak estimates several months are needed to rebuild depleted reserves and normalize supply chains. Russia remains committed to the OPEC+ mechanism, understanding its vital role in managing production and ensuring market stability during these turbulent times.

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In the current situation, it is hard to talk about a price war when there is a shortage in the market. What we are seeing instead is the deepest crisis in the industry.