By pivoting from Russian oil, India is sending a subtle message to US President Donald Trump that the oil market will be in chaos, according to an analyst. Igor Yushkov, a leading expert of the Financial University and the National Energy Security Fund in Russia, believes India will never give up Russian oil.
Amid reports that India quit Russian oil and China is cutting down on it, Yushkov believes the shortage will soon be felt in the market. Trump will meet with Saudi Arabian Prince Mohammed bin Salman when the latter flies to Washington next month. It is expected that he will raise the oil issue during the meeting.
“Russia currently supplies India with approximately 1.6-1.7 million barrels per day. I think India is taking advantage of this—it's not giving up Russian oil, but hinting to the United States that it will be bad for them if India stops importing oil from Russia: you'll create a shortage and suffer,” Yushov was quoted by Russian media BFM.
The expert also highlighted the historic oil prices in the US during June 2011, which were weaponised by Trump to criticise the Biden administration. “Trump is aware that the same could happen to him. He fears that if he puts pressure on Russia and no one replaces it, the same thing could happen to him,” Yushkov added.
For the same reason, Trump would want to test the waters with Saudi Arabia. He would want to know whether Saudi Arabia could increase production and how quickly it can do it. He would also want to know whether the kingdom is politically prepared to do so. Because if Saudi Arabia increases production, it means the OPEC+ deal will be broken, and then everyone will start increasing production—the participants will not be burdened by any quotas. And here, too, the question is how much they will be able to increase production,” Yushkov said.
“Without Russia, OPEC as a whole will not be able to increase production even by 7 million barrels per day in the medium term. Some estimates suggest that if the OPEC+ deal falls apart and production is increased, without Russia, that would be approximately 3.5-4 million barrels per day, and even that is not a given. The second point is that if everyone produces at maximum capacity and prices, on the contrary, fall, then American oil companies will also begin to reduce production. And these are precisely the Trump voters who brought him to power," the expert said.
