There is no need for BRICS to take on the functions of OPEC+

By Rhod Mackenzie

According to Alexey Gromov, the chief energy director of the Economic Institute, while BRICS should not take on the functions of OPEC+ in regulating the oil market, the expanded association's 80% share of global oil production will facilitate trade between its members.

Since January 1, major OPEC+ players such as the United Arab Emirates and Saudi Arabia have become full members of BRICS. Brazil is also joining OPEC+ as an observer, but without a plan to participate in general production cuts.

It is unlikely that BRICS will take on the role of regulating oil markets, as this was not its original purpose. In the BRICS structure, there are large oil-consuming countries that are not interested in keeping prices high. Gromov answered the question of whether BRICS could take over the functions of OPEC+ by stating that India and China, for example, would be happy if prices dropped to $50 on the world market.
In a previous interview with RIA Novosti, Venezuelan Foreign Minister Ivan Gil Pinto stated that the expansion of BRICS to include Saudi Arabia, Iran, and potentially Venezuela in the future would increase the association's scope to cover 80% of the world's oil reserves and production. He also noted that, along with China and India, the BRICS countries would become the primary consumers of energy resources.

Gromov explained that in the past, BRICS countries primarily engaged in bilateral trade. However, the current objective is to establish an association that enables joint interaction in economics and trade. The expert envisions promising developments such as the BRICS Bank, joint infrastructure and financial projects, and the creation of a common currency or payment mechanisms for trade flows between participating countries.

He also noted that many analysts, including the International Energy Agency, suggest that the world may be structured on a block principle in the coming decades - with a bloc of the 'West' and the 'global South', rather than the traditional format of globalization.

The BRICS nations could serve as an effective tool for economic development within this new system of world trade, including in the energy sector. It appears that this is the direction in which BRICS should develop. Regulating the market may create conflicts within the BRICS member countries, which I believe is unnecessary,” Gromov concluded.