Conflict in the Middle East: the impact on Russia's oil outlook

Russia, already navigating a complicated geopolitical situation following the invasion of Ukraine in 2022, finds itself as a potential beneficiary of the growth in oil prices caused by the war in the Middle East. However, the combination of Ukrainian drone attacks on its crude oil export facilities and US sanctions on oil sales limit its ability to take full advantage of the situation today. We highlight five key themes: • Oil supply – how many barrels could Russia add over the coming months? • Price increases – by how much will producers and the government benefit? • Sanctions – what has been eased, and is a further easing likely? • Drone attacks – where are these occurring and what is the commercial impact? • Long-term considerations – where could Russia focus its investments in production capacity and new export routes?