Russian Deputy PM Alexander Novak said the possible release of the strategic stockpiles by the US and other large consumers will have a limited short-term impact on the oil market
Russian Deputy Prime Minister Alexander Novak said on Wednesday that OPEC+ group of largest oil producers has resisted calls from Washington to boost output because it wants to provide the market with clear guidance and not deviate from policy.
The US has repeatedly pushed OPEC+ to accelerate output hikes as U.S. gasoline prices soared and President Joe Biden’s approval ratings slid. Faced with resistance, Washington said in November it and other consumers would release reserves.
Asked why OPEC+ rebuffed the calls, Novak said OPEC+ had a long-term vision.
We believe that it would be right for the market to show in the mid-term how we will increase production as demand grows, he told RBC media outlet.
The producing companies should understand beforehand which investments they have to plan in order to ensure a production increase, he said.
OPEC and its allies agreed earlier this month to stick to their existing policy of monthly oil output hikes despite fears that a U.S. release from crude reserves and the new Omicron coronavirus variant would lead to a fresh oil price rout.
Novak also said the possible release of the strategic stockpiles by the US and other large consumers will have a limited short-term impact on the oil market.
He said global oil demand was seen rising by around 4 million barrels per day (bpd) next year after an increase of up to 5 million bpd this year.
Novak said an oil price of between $65 and $80 per barrel should be comfortable next year. Currently, oil is trading below $80.
The articles are for information purposes only and Precise Investors shall not be held responsible for any errors, omissions or inaccuracies within it. Any rules or regulations mentioned within the website are those relevant at the time of publication and may not be the most up-to-date.
Precise Investors does not endorse any of the products or services that appear on it or are linked to it and are not liable for any action that you may take as a result of the content of this website, or losses or damage you may incur doing so.
There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.
Please remember that investments of any type may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.