There are almost no producers in the world who would be interested in maintaining low oil prices. This was stated by the head of VTB Andrei Kostin on the air of the program “Big Game” on Channel One, reports the publication of RBC owned by Grigory Berezkin.
Low prices are not beneficial to either Saudi Arabia or the United States, Kostin emphasized. According to him, the budget of the Middle East country is based on prices from $ 65, and American shale oil costs about $ 40. Given this, the average annual price of raw materials is forecasted to be around 40-45 dollars, which will allow Russia to have a budget without deficits, he noted.
Kostin also admitted that coronavirus will affect oil prices. He suggested that oil consumption will decline, as “airplanes will not fly, cars will not drive.”
The price war in the oil market began after the failure of the OPEC + negotiations on a further reduction in production and a rapid drop in fuel prices. Russia refused to approve an additional production limit of 1.5 million barrels per day, explaining that the United States immediately lost the volumes.