kremlin.ru | I cannot help but quote some statistical data. According to EU statistics, exports to Russia amounted to 89.3 billion euros in 2021 and imports from Russia to 162.5 billion euros. The deficit in Russia’s favour is 73.2 billion euros. That is data for 2021. In the early months of 2022, this deficit increased to 103.2 billion euros.
What caused it? We sell our goods and we are ready to buy European products, but they refuse to sell them. They imposed embargos on several categories of goods one after another, hence the deficit. What does this have to do with us? They will blame us again. We sell what they want to buy – and at market rates. We are ready to buy from them but they will not sell. The deficit keeps growing, to repeat, through no fault of our own. Just do not walk away from cooperating with Russia. That is it.
I would like to note – as European officials at the highest level also mentioned – that European wellbeing in the past decades has been mainly based on cooperation with Russia.
The consequences of the partial rejection of Russian goods are already hitting the European economy and residents. But instead of working on restoring their own competitive advantage in the form of affordable and reliable Russian energy sources, the Eurozone countries are only making the situation worse, including by capping the price of oil and oil products from our country. But it is not only European countries; they are doing this together with North America, as planned, beginning December of this year.
I will quote the American economist, Nobel Prize winner Milton Friedman: “If you want to create a shortage of tomatoes, for example, just pass a law that retailers cannot sell tomatoes for more than two cents per pound. Instantly you will have a tomato shortage. It is the same with oil or gas,” end of quote. Let me remind you that Milton Friedman passed away in 2006. He had nothing to do with the Russian government and cannot be designated as a Russian agent of influence.
It would seem that these are truisms. But the leaders of some countries, their bureaucratic elites dismiss these obvious considerations, and, on someone else's command, are deliberately pursuing a policy of deindustrialising their countries, reducing people’s quality of life, which will certainly entail irreversible consequences.
It should be clearly understood that if the price of oil from Russia or other countries is limited, if some artificial price caps are imposed, this will inevitably worsen the investment climate in the entire global energy sector, then exacerbate the global shortage of energy resources and further increase their cost, and this, I repeat, will primarily hit the poorest countries. These inevitable consequences are plain to see. And experts, including world-class ones – I just gave you a quote – talk about it all the time.
No amount of intervention or the unsealing of oil reserves will remedy the situation. They simply do not have as much spare resources as they need – that is the whole point. They need to understand this eventually.
The fact is that aggressive promotion of the green agenda, which, of course, needs support, as I said, but it should be done right, so, the aggressive promotion of this agenda, including in the euro area, has led to underinvestment in the global oil and gas sector. Already. Meanwhile, the EU and the United States have imposed sanctions on leading oil producers, which make up about 20 percent of the global output.
As a result, in 2020–2021, investment in oil and gas production dropped to the lowest levels in the past 15 years. You see, it happened in 2020 and 2021, long before our special operation in Donbass. Investment was less than half of what it was in 2014 in the wake of what the so-called Western politicians did, and businesses underinvested by $2.5 trillion. I will come to that later: what does the OPEC+ decision have to do with it? The OPEC+ decision is designed solely to balance the global market. They have found their scapegoat in OPEC+. What does it have to do with anything? Clearly, to reiterate, they are simply covering up their mistakes. I will come to that later.
There is one more important point. Suppose the oil price cap is imposed. Who can guarantee that a similar cap will not be imposed in other sectors of the economy, such as agriculture, the production of semiconductors, fertilisers, or the metal industry, and not only with regard to Russia, but to any other country? No one can give such guarantees, meaning that with their reckless decisions, some Western politicians are breaking the global market economy and are, in fact, posing a threat to the well-being of billions of people.
The so-called neo-liberal ideologists of the West are known to have destroyed traditional values before, we all see. Now, they seem to have set their sights on free enterprise and private initiative.
As I mentioned earlier, Russia invariably fulfills its obligations in stark contrast to Western countries, which cynically refused to honour signed finance and technology, as well as equipment supply and maintenance contracts.
I am here to say one thing: Russia will not act contrary to common sense or underwrite someone else’s prosperity. We are not going to supply energy to the countries that introduce price caps. I want to tell those who prefer con jobs and shameless blackmail to business partnerships and market mechanisms – we have been living in this political paradigm for decades now – you should know that we will not do anything that disadvantages us.
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