(Bloomberg) — Western nations made a mistake by imposing energy sanctions on Russia, and if they persist with further restrictions it will be a catastrophe for global markets, said President Vladimir Putin.
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“Sanctions restrictions on Russia cause much more damage to those countries that impose them,” Putin said on Friday at a meeting with government officials that was broadcast on Rossiya 24 TV. “Further use of the sanctions policy may lead to even more severe, without exaggeration, even catastrophic consequences for the global energy market.”
The price of Brent crude has jumped by over a third and benchmark European gas more than doubled since the start of the year after the West imposed several waves of sanctions against Russia in retaliation for its invasion in Ukraine. The resulting energy supply crunch has hampered global economic growth and increased inflation, raising the risks of recession.
While the goal of these measures was to reduce the inflow of petrodollars into the Kremlin’s coffers and force Putin to stop the war, Russia has responded by redirecting its oil exports to India and China, and capping gas flows to Europe. The president said his country’s energy industry has now stabilized, with oil production rising by 0.5 million barrels a day to 10.7 million a day in June.
Attempts by Western nations to find replacements elsewhere for Russian energy supplies will not yield immediate results, Putin said, addressing members of his cabinet, including Deputy Prime Minister Alexander Novak, as well as Igor Sechin, Chief Executive Officer of Russian oil giant Rosneft PJSC.
“We see that the West is trying to force other oil exporting countries to increase their production volumes,” Putin said. Yet the global energy market “does not tolerate any rush,” he said. “The already made mistakes cannot be corrected within a couple of days.”
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