Oil prices can stay low far too long. Nina Kozlova’s comment in “Gazeta.ru”

World demand for hydrocarbons will decline. As a result, most producing countries, except for the United States and Saudi Arabia, will face serious decline in production. According to the International Energy Agency, the decline can reach nearly 8% by 2025 in Russia. The International Energy Agency predicts that oil production in Russia may decrease by about 8% up to 10.5 million barrels per day by 2025 as compared to 11.3 million in 2016.

Nina Kozlova

General Director of FinExpertiza

“The situation in the oil market is such that there are discrepancies even in estimations made by different organizations as to the actual oil production by OPEC countries. The International Energy Agency regularly releases their reports with updates every time. Therefore, this information should be considered as a forecast (based on certain expectations), but not a diagnosis.

As before, the key factor in determining the price of oil is demand & supply. Recent events show that producing countries are able to come into agreement with the aim of maintaining such a balance. Investments decreased against a background of reduction in the barrel price are beginning to grow again in the industry, supporting the industry not only in exploring new deposits, but also in applying new production technologies.
Petroleum is indeed non-renewable resource in the long run. There are several development scenarios in this context. It is hoped that the Russian economy will shift to other sources of revenues. For example, the Ministry of Finance has predicted that by 2020 the budget will depend on oil and gas revenues at the level of 30% against 50% in 2012-2014.”