Russia Prepares New Long-Term Energy Plan

Market needs, not Western sanctions, a G7 price cap or other restrictions put on Moscow in response to the Ukraine war, will dictate future Russian investments in its energy sector. Russian officials say long-term oil and gas outlays will hinge on "where the market heads and what the market needs," and that Moscow has not made any changes to these plans since the Ukraine war started over a year ago. Russia's oil majors have not publicly announced any significant shifts in strategy or investment programs since the war started. However, the departure of Western majors and the imposition of sanctions limiting access to Western technologies and equipment — as well as a major redirection of Russian export flows to Asia — have clearly forced them to rethink their plans. Russian officials' public statements also suggest Moscow won't abandon its long-term plans. These include investments in exploration and development of more complex, hard-to-recover oil reserves, boosting extraction rates. Offshore, LNG and refinery modernization projects remain priorities, as do the establishment of petrochemical clusters and infrastructure construction to open new export routes for Russian hydrocarbons. Russia has also not backed off its low-carbon or decarbonization plans or efforts to become more technologically independent.