Russian Oil Companies Will Have to Reduce Their Output

1 february 2019 | Neftegazovaya Vertikal

Russian oil companies will have to go for an unpleasant decline in production, which will reduce the growth achieved in 2018. Such an opinion was expressed by the Chief Advisor to the Head of the Analytical Center Leonid Grigoriev in the article "Barrels of Billions" published on the Neftegazovaya Vertikal web portal.

Leonid Grigoryev
Leonid Grigoryev
Chief Adviser to Head of the Analytical Center

According to the expert, this measure is necessary in connection with the OPEC+ agreement providing for the reduction of oil production by 1.2 million barrels per day by the member countries, designed to maintain the market stability.

"The decision to reduce production was not an easy one. However, it can keep the market in equilibrium, with the growth of production in the United States, and, as a side effect, will allow for Iran’s exports. Russian companies will have to make an unpleasant decline in production and then there will be the same complicated calculations, sanctions, nerves, price fluctuations, and attempts to ensure the well-being of citizens of Russia and other countries with this economic and budgetary structure, seriously dependent on oil exports," writes Mr. Grigoriev.

In his publication, the expert has analyzed the history of oil price fluctuations since the 1970s and their impact on the Russian economy, as well as outlined the trends that will regulate the world market in the near future. They include the new OPEC+ agreement, the reduction of exports by Iran and Venezuela, and the possible growth in shale oil production by the United States.

Source: Neftegazovaya Vertikal (Oil and Gas Vertical)

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