Bloomberg forecast that, that the Russian Federation and Saudi Arabia are not going to back down in price war, made in order to maintain the theme of the oil crisis, I told FBA “economy today” Deputy Director General of the National Energy Institute Alexander Frolov.
Bloomberg agency published material, in which he wrote about, that the Russian Federation and Saudi Arabia do not intend to concede in price war, and the dispute countries "threatens to turn into a survival of the fittest Darwinian, because of which the Allies, and opponents of the two countries, including US shale oil companies, They can be squeezed out of the market ".
"This confrontation is bad for a lot of players - a banal statement. Russia still has not announced any conflict with Saudi Arabia.
Previously only heard some statements, which can be partly interpreted as a confirmation of the confrontation with Riyadh, but they do not come from the people, decision-makers at the highest level. Russia is the only step - this message is the need to extend the OPEC + on the existing conditions until the end of March 2020 of the year", - said the expert.
but, says expert, in the beginning of March 2020 , it was too little data, which would fully assess the situation and predict, what kind of impact will the global economy or that decision.
"There were also not clear at the time and the effects of the pandemic coronavirus measures, which different countries. It would therefore be logical to wait for the leaders to the end of March and had already taken some action.
In addition, the Deputy Minister of Energy of the Russian Federation Pavel Sorokin said earlier, that the proposed partners in OPEC oil production + restrictions 0,6-1,5 million barrels per day were "a drop in the ocean" compared to the impact of the pandemic in the fall in oil demand ", - the expert added.
Price war - the initiative of Saudi Arabia
The collapse of the OPEC deal +, which dropped the price of oil 9 Martha 2020 year to a minimum, It provoked a strong reaction in Saudi Arabia, Announced capacity in oil production and, respectively, the start of a price war.
"Riyadh said, which will increase production from April 2020 year 2-3 million barrels per day. But such actions can I call irresponsible and stupid clowning, which at the same time it requires serious and cautious attitude of other countries.
But the Saudis allegedly by chance there were no buyers for the extra oil volumes, that they intend to offer in the framework of a price war, they themselves unleashed, even at bargain prices. But on Riyadh wanted to raise the volume of production to 13 million barrels a day ", - added the spokesman.
Influence of the oil dispute at the medium-sized players
Recall, from 1 April OPEC members + the transaction will not have any obligations to each other.
"We must pay tribute to Bloomberg, that edition drew attention to the fate of the other players. After all, apart from the three countries, read about all media, no longer does not produce oil. But in addition to the Russian Federation, United States of America and Saudi Arabia, there are other.
Iran, Iraq, Norway, Brussels and others also feel the impact of falling markets. In this case, the daily costs for the business of the company, production of goods and services exceeds the current price level, especially in the US ", - said the expert.
Alexander Frolov notes, that America must constantly bear the operational costs to maintain current production levels, which is based on the constant drilling of new wells.
"More 64% in the United States refers to unconventional oil, ie shale. In this case, the well productivity declines over 2-3 years. US Department of Energy predicts stagnating production in the current year and the reduction in 2021 year ", - said the expert.
Inability to adapt to the low oil prices demonstrated and Norway, which fluctuated during the last crisis 2014 year. Companies of this country bear the specified period of multibillion-dollar losses.
The war in oil prices: forecast for the end
it is noteworthy, that the global oil market has experienced a great shock to the United States of America in the invasion of Iraq 1991 year. Riyadh again announced its intention to increase the volume of production in the 26% compared with the February level.
"The problem is, that this crisis does not need anyone, including Saudis, which are not considered in terms of its enforcement of the Russian Federation to the oil world in their understanding of the market capacity. Saudi Arabia did not thoughtful work, based on objective data. This indicates, they will definitely try to cope with the current crisis - it beats all countries. Therefore, Russia's largest companies quietly survive the difficulties.
I am optimistic about the situation - before the experience of interaction of oil-producing countries in OPEC format + showed a rapid and highly effective solution of crisis situations. It is quite possible and restore such cooperation format. But today, it prevents only the personal initiative of Saudi Arabia, and the lack of ability to admit mistakes and to negotiate. In this case, we can say that, that the recovery in demand for petroleum products and crude oil in the world will start to fly or the beginning of summer 2020 of the year, not earlier", - summed up the expert.
Alexander Melnik
