Core Viewpoint - The announcement of PetroNeft's liquidation marks the end of an era for the Russian oil industry, highlighting the significant impact of Western energy companies' withdrawal since the onset of the Russia-Ukraine conflict [1][3][8]. Group 1: Withdrawal of Western Energy Companies - Major Western energy companies, including BP, Shell, and ExxonMobil, have collectively exited the Russian market, resulting in losses exceeding €100 billion for European firms [3][4]. - BP's divestment of its 19.75% stake in Rosneft led to a loss of $25.5 billion, while other companies followed suit within days, abandoning projects like the Nord Stream 2 pipeline [3][4]. Group 2: Reasons for Withdrawal - The withdrawal is driven by three main pressures: severe political conditions due to sanctions, significant economic losses from asset nationalization, and a critical shortage of technology that has crippled Russian oil production [4]. - The Russian government has nationalized foreign assets, leading to ExxonMobil's $4 billion Sakhalin project being seized, and TotalEnergies' $14.8 billion investment becoming worthless overnight [4]. Group 3: Consequences for the Russian Oil Industry - The lack of essential components has led to widespread shutdowns in Russian refineries, with projections indicating a historic low in petrochemical production capacity by 2025 [4]. - Oil production has been severely impacted, with a 30% reduction in output from the Sakhalin-1 project due to the withdrawal of deep-water drilling technology [4]. Group 4: Financial Crisis in Russia - The EU's embargo has resulted in 1.5 million barrels of oil per day being unsold, with India purchasing at discounted rates but complicating repatriation of funds due to currency issues [4][6]. - The Russian central bank has raised interest rates to 20% to stabilize the ruble, which has depreciated to 114 rubles per dollar, with inflation exceeding 15% [4]. Group 5: Limited Support from Other Markets - Attempts to sell overseas assets, such as the $20 billion offer for Nayara Energy, have been met with rejection from Indian firms and caution from Saudi Aramco due to potential secondary sanctions [6]. - Domestic companies are struggling with funding shortages, and even state-owned Rosneft, with over 80% debt, is unable to provide financial support [6]. Group 6: China's Role - China has emerged as a partial lifeline, with PetroChina agreeing to purchase 500,000 barrels of oil daily, but under unfavorable terms for Russia, including a 30% discount on international prices [8]. - Russian upstream exploration projects are stalled due to technology restrictions, with Chinese firms unwilling to invest directly in oil fields [8].