Elon Musk tweets oil, gas output must be increased amid Russia-Ukraine war

FPJ Web DeskUpdated: Saturday, March 05, 2022, 09:37 AM IST
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Russia is one of the biggest crude oil producers with production of around 10 million barrels per day--i.e. about 10 percent of the global supply. /Representative image of Elon Musk |

As the Russia Ukraine war rages on, Tesla CEO Elon Musk has tweeted that the US needs to increase its oil and gas output.

He tweeted: "Hate to say it, but we need to increase oil & gas output immediately. Extraordinary times demand extraordinary measures."

Musk added that although increasing oil and gas production would affect Tesla negatively, sustainable energy solutions cannot react instantaneously to make up for Russian oil and gas exports, ANI said.

WTI crude has breached $116 per barrel for the first time since 2008 while Brent crude tested 2012 highs.

Bloomberg News reported that the Biden administration is considering imposing a ban on imports of Russian crude oil to the United States.

US Senators Joe Manchin proposed a bill that would prohibit the import of Russian crude oil, petroleum, petroleum products, liquefied natural gas (LNG) and coal.

Meanwhile, US President Joe Biden, in his State of the Union Address on Wednesday, pledged to enable exports of energy from US reserves with the EU working on to curb energy dependence on Russia, in particular by building LNG terminals and negotiating with alternative suppliers, including Norway.

Crude price soar

Oil prices initially soared on Thursday as the Ukraine war sparked a run on commodities that raised fears of "stagflation," while equity markets fell as investors gauge the impact of the Federal Reserve's plans to tighten monetary policy.

Crude oil has rallied over 50 percent since start of the year and nearly half of it has come in the past one week since Russia started attacking Ukraine on February 24.

The fresh surge in energy prices heightened worries about the European economic outlook, leading the euro to slide to its lowest level in almost six years against Britain's pound and pinning it near 21-month lows versus the dollar, Reuters said.

Global crude oil market has tightened significantly in the last few months owing to strong demand recovery and slow production growth. The tightness in global market has made crude susceptible to supply risks, said Ravindra Rao, is CMT, EPAT, VP-Head Commodity Research, Kotak Securities.

Russia is one of the biggest crude oil producers with production of around 10 million barrels per day--i.e. about 10 percent of the global supply.

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