17 May 2022 17:57

Putin: Advanced oil refining needs to be encouraged, high revenues shouldn't put companies off

MOSCOW. May 17 (Interfax) - Growth of oil and gas revenues, which is taking place against the backdrop of high energy prices, should not discourage oil and gas companies, because it is unlikely that they will be able to do business as before, Russian President Vladimir Putin said, opening a meeting on the oil industry situation.

He said it was necessary not just to extract oil, but also to establish the whole chain up to the end consumer, in particular, to incentivize advanced oil refining and oil service projects.

Western countries have already adopted certain sanctions and are declaring their possible refusal of Russian energy resources, which has led to the prices of oil and oil products growing, Putin said.

"We should act pragmatically, relying on our own economic interests before all. The current result of, let's say directly, the erratic actions of our partners apart from damage to the European economy itself is growth in the revenue of the Russian oil and gas sector. We have to keep such a factor in mind, of course, we understand this, see," he said.

"But this shouldn't discourage our companies. Changes on the oil and gas market are tectonic in nature, and doing business as before, using the old model, already appears unlikely, of course. It's important not just to produce oil, but to establish the whole vertical chain to the end consumer under the new conditions," Putin said.

The government will do everything that depends on it to create conditions for such changes in companies' business models, he said.

"To perfect logistical capabilities, ensure the system of payments in national currencies. I understand that there are certain limitations here, but this needs to be strived toward, and we're going to do it. We're going to increase the availability of lending resources and insurance services for oil companies, promote projects connected to advanced oil refining and the development of domestic oil service technologies, including field development and operation," Putin said.

Changes in the priorities for the development of the oil and gas sector were discussed at a meeting on April 14, and "strategic decisions that provide for the protection of the long-term interests of the Russian economy" were adopted, he said.

"Understanding what steps will be taken in the near future in the West, we must draw conclusions in advance and act proactively, turning the ill-considered chaotic steps of some of our partners to our benefit, to the benefit of our country. Of course, we should not rely on their endless mistakes, we just have to be pragmatic. And I would like to discuss a plan of additional measures that will provide for maximum protection of our national interests, consolidation of economic sovereignty," Putin said.