• 3 days Nuclear Bomb = Nuclear War: Saudi Arabia Will Develop Nuclear Bomb If Iran Does
  • 2 days Statoil Changes Name
  • 3 days Tillerson just sacked ... how will market react?
  • 2 days Russian hackers targeted American energy grid
  • 2 days Is $71 As Good As It Gets For Oil Bulls This Year?
  • 3 days Petrobras Narrows 2017 Loss, Net Debt Falls Below $85bn
  • 3 days Proton battery-alternative for lithium?
  • 3 days Ford Recalls 1.38 Million Vehicles (North America) For Loose Steering Wheel Bolt
  • 2 days Oil Boom Will Help Ghana To Be One Of The Fastest Growing¨Economies By 2018!
  • 2 days Country With Biggest Oil Reserves Biggest Threat to World Economy
  • 3 days I vote for Exxon
  • 2 days HAPPY RIG COUNT DAY!!
  • 3 days UK vs. Russia - Britain Expels 23 Russian Diplomats Over Chemical Attack On Ex-Spy.
  • 3 days Why is gold soooo boring?
  • 3 days South Korea Would Suspend Five Coal - Fire Power Plants.
  • 2 days Spotify to file $1 billion IPO
Oil Markets Set For A Major Move To The Downside

Oil Markets Set For A Major Move To The Downside

Oil markets are likely heading…

UK Looks To Ditch Russian Gas After Spy Scandal

UK Looks To Ditch Russian Gas After Spy Scandal

Following the spy poisoning scandal…

Russia’s Central Bank Sticks To Oil Price Forecasts

Putin Niabullina

The central bank of Russia has no plans to revise its current oil price estimates for the next 12 months despite the OPEC deal that saw international oil benchmarks pass the US$50 barrier and stay above it for a week now.

Speaking at an investor conference in London, the bank’s deputy governor Ksenia Yudayeva acknowledged that prices could go further up as a result of the international agreement, but also noted that there was significant downward risk, although she did not elaborate.

Some, like Lukoil’s Vice President Leonid Fedun, are more optimistic. Fedun told media that crude oil prices could reach US$60 a barrel in 2017, based on “the history of such operations.”

The central bank’s oil-price scenario for the medium term, not just for 2017, is for US$40 a barrel. At the same time, there is a second scenario envisaging average international prices of US$55 a barrel.

Last month, Yudayeva’s boss, governor Elvira Nabiullina, said that Russia was planning to start shifting its economic model away from the overreliance on mineral resource exports. The transition, Nabiullina admitted, will take a while and will not be a smooth process, but as soon as next year, Russia may register GDP growth, albeit at a modest rate of less than 2 percent.

The shift could take even longer if prices stay where they now, as, according to one economist from Russian banking group Alfa, every US$1 above US$40 translates into around US$2 billion in budget revenues. The 2017 budget, currently discussed by the government, has set the average international oil price at US$40 a barrel.

OPEC agreed last week to cut overall production by 1.2 million barrels per day, with Saudi Arabia shouldering almost half of the cut, and Russia agreeing to reduce its own output by 300,000 bpd, “gradually”. The gradual reduction will at some point coincide with a habitual seasonal production cut of around 150,000 bpd in the spring.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News