Europe's Economic Suicide and Putin's Meeting Discussing the Oil Industry

On Putin's agenda today was the weekly meeting on economic issues which today focused on the oil industry and related economic suicide being committed by EU nations thanks to the energy policy diktat to forego Russian hydrocarbons issued by NATO, which of course means the Outlaw US Empire. As you'll read below, Putin's remark to that behavior: “Such economic auto-da-fé, suicide, is, of course, an internal affair of European countries.”

Also as you'll read, Putin made a very specific and far reaching proposal regarding the oil industry: “to build the entire vertical chain up to the final consumer.” This doesn't just involve the construction of filling stations. Rather, with the withdrawal of most international petrochemical support companies from Russia as a result of the Hybrid War being waged by the West, Russia must rapidly field its own companies to construct and maintain the wide gamut of activities that enable the final delivery of products to customers. Alexander Novak is one of Russia's Deputy Prime Ministers who was previously Minister of Energy and seems to have combined that portfolio with his DPM position and provided the bulk of today's discussion, which alas isn't included in the transcript, nor is it reported on by Russian media as far as I was able to find.

In his remarks, Putin references the April 17th meeting that provided the initial groundwork for today's discussion, so I've linked to it so those interested can read it as well, although the same problem of Novak's missing testimony is present. In related news, the Outlaw US Empire has decided to allow some national and international oil companies to return to Venezuela, although it remains to be seen if they'll be allowed to do so by the Maduro government. Clearly, this news signifies the blowback from its sanctions on Russia are finally hurting the NATO King as its transport fuel costs are higher than ever historically and heading higher as Summer approaches.

What follows is the machine translation of the oil industry discussion without any correction or additional emphasis by me.

President of Russia Vladimir Putin: Colleagues, good afternoon.

Today, as part of our series of regular meetings on the economic agenda, we will discuss the situation in the oil industry.

For Russia, with its rich hydrocarbon reserves, this industry, as well as the fuel and energy sector as a whole, has been and remains one of the leading components of the national economy, plays a significant role in ensuring the domestic market and, of course, in realizing the country's export potential.

What would you like to note in this regard? All these years, all the years before, we paid special attention to the industry. New fields were actively developed, production increased and the quality of oil refining improved. Innovations, digital, environmentally friendly technologies and services were widely introduced. And stable, reliable supplies of Russian oil to foreign consumers served as a guarantee of Russia's leading position in the global supply of energy resources. And of course, the Government, the authorities at all levels, including the regional levels of government, constantly supported you.

Unfortunately, our colleagues in Western countries behaved quite differently – both you and representatives of the energy sector in other countries – know and understand all this very well. In fact, the so-called political class in the West began to speculate on the absolutely natural concern of many people on the planet about climate problems, climate change problems.

It is obvious that for domestic political reasons they began to overestimate the possibilities of alternative energy and underestimate the importance of traditional energy, including all its areas, including hydrocarbons. This constant abuse was very specific.

Let me repeat once again, you know this better than anyone else: bank financing has been restricted, companies and company management have been and, in my opinion, all sorts of far-fetched litigation has been conducted, plots of land necessary for new projects have not been allocated, opportunities for the development of transport, and a variety of transport, are being limited, problems are being created on freight and in other areas. which are necessary in order to ensure timely and in the right amount of investment in the industry. All this is the main component, the main component, the basic component of the problems that arise in the global energy sector, and above all, of course, in hydrocarbons.

Of course, political considerations have been added to this, and this is also obvious to everyone. By the way, in this area, everything that is happening today, including, to our great regret, around Ukraine, is connected with the ill-conceived policy of the so-called collective West, which for decades ignored Russia's absolutely legitimate concerns in the sphere of ensuring its security and in every possible way encouraged nationalist, neo-fascist elements in the Kiev leadership, neglected the problems that were developing in the south-east of Ukraine and, in fact, for eight years they contributed to the continuation of the hostilities that the Kiev regime had begun eight years earlier.

And today we see that for absolutely politically colored reasons, because of their own ambitions and under the pressure of the American overlord, European countries are introducing more and more new sanctions in the oil and gas markets. All this leads to inflation. And instead of admitting their mistakes, they look for the culprits on the side.

Yes, the Europeans explicitly admit that they cannot yet completely abandon Russian energy resources. It is all the more obvious that some EU states, in the energy balance of which the share of Russian hydrocarbons is particularly high, will not be able to do this for a long time. However, they set such a task, we see it. They bet without paying attention to the damage they have already done to their own economy.

One gets the impression that our Western colleagues – politicians and economists – have simply forgotten the basics of elementary, basic economic laws or, to their own detriment, prefer to deliberately ignore them.

What results do they achieve with their decisions?

First. The sanctions already adopted by our European colleagues and the declarations on the possibility of a complete rejection of Russian energy carriers in the future have led to the fact that oil prices on the spot market are rising. You know this yourself: if you say something inaccurate at the political level, that's it, it is immediately reflected in the market, instantly.

Second. The cost of petroleum products in the European market, such as, for example, diesel, due to their actual deficit, is growing even higher than oil prices. Such energy inflation – they are trying to write off this energy inflation on us, they call it by our names, they blame everything on Russia, trying to cover up, as I have already said, their own systemic mistakes in this area – this is already directly hitting transport and European industry, falling on the shoulders of consumers – millions of Europeans.

Finally, the third and most important thing. The rejection of Russian energy resources means that Europe systematically, in the long term, becomes the region with the highest cost of energy resources in the world. Yes, of course, prices here will increase, and resources will also go here, to these prices, but it will not be possible to radically change the situation. And this is in the most serious way, and, according to some experts, irrevocably can undermine the competitiveness of a significant part of the European industry, which is already increasingly losing competition to companies from other regions of the world. Now these processes will certainly be accelerated. It is obvious that along with Russian energy resources, the possibility of increasing economic activity will also leave Europe for other regions of the world.

Such economic auto-da-fé, suicide, is, of course, an internal affair of European countries. We must act pragmatically, proceeding primarily from our own economic interests.

Now, frankly speaking, the result of the chaotic actions of our partners, in addition to the damage to the European economy itself, is the actual growth in the revenue of the Russian oil and gas sector. Of course, we need to keep this factor in mind, we understand this, we see it, but this should not discourage our companies.

Changes in the oil market are tectonic in nature, and doing business, as before, according to the old model, already, of course, seems unlikely. In the new conditions, it is important not only to extract oil, but also to build the entire vertical chain up to the final consumer.

At the same time, the state, as before, colleagues, will do everything that depends on us to create conditions for such a change in the business models of companies: to improve logistics capabilities, to ensure a system of settlements in national currencies – I understand that there are certain restrictions here, we have talked about this many times, but we need to strive for this, we will do it. We will increase the availability of credit resources and insurance services for oil companies, stimulate projects related to the deep processing of raw materials and the development of domestic oilfield services technologies, including the development and operation of fields.

At the meeting held on April 14, we discussed in detail the change in priorities for the development of the oil and gas industry. We have made strategic decisions that allow us to protect the long-term interests of the Russian economy.

Understanding what steps will be taken in the near future in the West, we must draw conclusions in advance and act proactively, turn the ill-conceived chaotic steps of some of our partners to our advantage, to the benefit of our country. Of course, we do not need to rely on the fact that mistakes will be made there endlessly, we just need to proceed pragmatically, as I have already said, from reality.

In this regard, I would like to discuss today a plan of additional measures that will allow us to protect our national interests as much as possible and strengthen our economic sovereignty, including in this case in the fuel and energy sector, paying special attention to the oil industry today.

Let's go through all these issues carefully, see and consult with you on how and what we need to do in the near future.

I give the floor to the Deputy Prime Minister Alexandru Valentinovich Novak.