Russian Energy Minister Alexander Novak said active work is underway for the establishment of the gas hub in Türkiye. ‘Currently, active work is underway with the countries that will participate in the implementation of this project, as well as with consumers in need of Russian gas,’ Novak said in an interview with the Russian state-run TASS agency on Monday.
The European gas market remains ‘relevant’ for Russia, and there are means for delivering additional volumes there, including through the Yamal-Europe pipeline, closed ‘based on political motives,’ the minister added.
The TurkStream currently works at full capacity, the Ukrainian route supplies to Europe one-third of the volume, stipulated in contracts, despite all contradictions, and deliveries of Russian liquified natural gas (LNG) to Europe grew up to 19.4 billion this year.
Asked about the restoration of the Nord Stream gas pipelines that were blown up in the Baltic Sea, Novak said it demands time and money, and the full assessment of such a possibility can be only made after the end of the investigation.
Novak named China, Türkiye, Kazakhstan, and Uzbekistan as potential consumers of the Russian pipeline gas, adding that there is also ‘a deeper prospect’ of gas deliveries to Pakistan and Afghanistan either through Central Asian infrastructure or from the territory of Iran on swap basis — an agreement under which Russia will receive Iranian gas in the south of the country, and in exchange supply gas to the north for Iranian consumers. He also said there is an agreement to temporarily increase supplies to Azerbaijan.
Novak called sanctions a ‘de-facto ban’ for supplies of Russian energy resources to the Western countries, adding that many decisions, including the price cap on oil and gas, are made to get political profit, and ‘provoke a deep long-term crisis, destabilization in Europe.’
The energy minister said Russia is building new logistics for transporting its oil and gas but until it is settled, the European embargo may lead to a decrease in oil production of 7-8% in 2023.
Novak thinks there may be some exceptions for deliveries of oil and oil products in the European embargo, noting that even Germany and Poland requested oil deliveries in 2023 without specifying the origin of the fuel, although earlier German officials said they meant Kazakh oil. ‘When consumers start interfering in the market economy, it only leads to an imbalance,’ Novak stressed.
The official said Russia did some preparatory work to oppose sanctions — expanded possibilities of sea oil supplies and developed insurance companies. He also praised the transfer to payments in national currencies, saying this practice stabilized the market.
‘Gazprom, for example, has completely converted the payment for the gas of the ‘Power of Siberia’ into yuan and rubles on a parity basis. Trade in Indian rupee, Turkish lira, and Russian ruble is also increasing,’ he said.
About the prospects of the Russian energy sector, Novak said: ‘Russia is the largest energy player (with 20% of the world’s gas exports and over 20% of oil) and is the third in the world in terms of coal supplies. … Obviously, energy consumption will only grow in the future, so I can’t imagine how the world economy will manage without our energy resources. There is no one to replace us. … In this regard, we are optimistic and set ourselves only ambitious goals,’ he said.