Brent Crude prices are set to be slightly higher than $80 per barrel at the end of this year, thanks to rising demand in the summer and production reductions from OPEC+, Russian Deputy Prime Minister Alexander Novak told Izvestiya in an interview published on Thursday.
Early on Thursday, Brent was trading at $77.21, down by 1.47% on the day.
According to Novak, Russia’s task is not inflating oil prices but balancing the market.
Russia warned in February that it would cut its crude oil production by 500,000 bpd due to EU import bans and price caps on its crude oil and oil products. Those 500,000 bpd cuts will extend until the end of 2023.
But last week, the International Energy Agency (IEA) said that Russia had failed so far to cut its oil production by 500,000 bpd as promised, and it may even be looking to boost output to compensate for lost revenues.
Asked by Izvestiya about his outlook on oil prices at the end of this year, Novak said he believes the price would be slightly higher than $80 a barrel.
“I hope that the demand will rise in the summer,” Novak said, adding that the ongoing production cuts in many oil producers should also tighten the market.
“I’ll repeat once again: we do not have the task of boosting prices, our task is to balance the market in the interest of both producers and consumers,” Novak said, reiterating the official narrative of the OPEC+ alliance, of which Russia is part.
Several OPEC+ producers, including Russia, surprised the market in early April, saying they would keep another 1.6 million bpd off the market for the rest of the year.
Earlier this week, Saudi Arabia’s Energy Minister, Prince Abdulaziz bin Salman, warned traders—again—against shorting oil futures, less than two weeks before the OPEC+ meeting on June 4.
By Tsvetana Paraskova for Oilprice.com
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