Russia still has buyers for much of its oil despite sanctions but will face difficulty overcoming the loss of western technology and capital, as other major oil countries have seen production fall after sanctions and the withdrawal of international oil companies, Chevron (NYSE:CVX) CEO Mike Wirth told The Wall Street Journal in an interview published Saturday.
“If you look at Iran and Venezuela, two other examples of large producers that have come under sanctions and have been pretty well cut off from the same kinds of investments and technology, their productive capacity degrades over time,” Wirth told WSJ.
Chevron (CVX) had no sizable operations in Russia and was the least affected major oil company by the invasion of Ukraine, but BP, Shell and Exxon all said they would exit the country, and oilfield services firms Halliburton, Baker Hughes and Schlumberger said they would suspend new investments in Russia.
Wirth also said if President Biden wanted to see global oil supplies rise, Saudi Arabia was among the very few producers with spare capacity to bring more crude to market quickly.
“This is the role Saudi has historically played,” Wirth told WSJ. In the context of the broader relationship and whatever discussions may be ongoing, if that can lead to more supply into the market, that’s a positive outcome for world energy markets.